Chrysler 2005 Annual Report Download - page 26

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Report on Operations Financial Review of the Group
Components and Production Systems business area
The Components and Production Systems business area had revenues of 6,642 million euros, for an overall increase of 3.5%, due to
the positive performance of Magneti Marelli (+6.3%) and Teksid (+13.8%), partly offset by a reduction at Comau (-8.1%).
(in millions of euros) 2005 2004 % change
Components (Magneti Marelli) 4,033 3,795 6.3%
Metallurgical Products (Teksid) 1,036 910 13.8%
Production Systems (Comau) 1,573 1,711 -8.1%
Total 6,642 6,416 3.5%
Magneti Marelli had revenues of 4,033 million euros in 2005. The 6.3% increase compared to 2004 partly reflected the consolidation
of Mako from January 1, 2005. Excluding changes in the scope of consolidation and exchange rate effects, revenues increased by roughly
2.0%. The strong performance of Magneti Marelli operations in Brazil and Poland and the positive trend of its onboard electronics activities
offset lower sales volumes in Italy, which started recovering in the fourth quarter.
Teksid had revenues of 1,036 million euros, up 13.8% from 2004. Higher volumes at the Cast Iron Business Unit (+4.6%), the positive
impact of exchange rates, and the recovery of higher raw materials costs through higher sales prices contributed to the improved
performance, more than offsetting lower volume in the Magnesium Business Unit (-6.8%).
Comau had revenues of 1,573 million euros in 2005. The 8.1% reduction from 2004 reflected the transfer of Comau’sEuropean service
activities to Iveco, Magneti Marelli, and CNH. When calculated on a comparable scope of consolidation, Comau’s revenues rose
by approximately 6%, reflecting a strong performance in the Car Bodywork and Maintenance areas.
Other Businesses
Other Businesses recorded an overall decrease of 19.2% from 2004 due to the performance of Business Solutions and Other companies.
(in millions of euros) 2005 2004 % change
Services (Business Solutions) 752 976 -23.0%
Publishing and Communications (Itedi) 397 407 -2.5%
Holding companies and Other companies 469 620 -24.4%
Total 1,618 2,003 -19.2%
Business Solutions had revenues of 752 million euros in 2005, down 23% from 2004.The decrease stemmed in part from the change in the
scope of consolidation (sale of the temporaryemployment agency WorkNet). On a comparable scope of consolidation, the decrease in
revenues was approximately 5%, mainly reflecting lower activity in the administration area, following a redefinition of the services the Sector
provides to other Group companies.
In 2005, Itedi had revenues of 397 million euros, down 2.5% from the previous year. The downturn is attributable to lower advertising
revenues following termination of a major concession agreement, lower newspaper sales revenues, and a more selective and profitability-
oriented approach to brand stretching initiatives.