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Holden posts $27.3m profit on national sales company operations in 2016; second consecutive year in the black

Holden has posted a $27.3M after-tax profit ($40.3M profit before tax) for the 2016 calendar year on its National Sales Company (NSC) operations, the second consecutive year in the black for the Lion brand. This result underlines the sustainable profitability of Holden as a full-line vehicle importer for the long-term. Holden recorded a combined (national … Continued

Holden has posted a $27.3M after-tax profit ($40.3M profit before tax) for the 2016 calendar year on its National Sales Company (NSC) operations, the second consecutive year in the black for the Lion brand. This result underlines the sustainable profitability of Holden as a full-line vehicle importer for the long-term.

Holden recorded a combined (national sales company and manufacturing arm) net profit after-tax of $152.8M million in 2016 ($235.1M before-tax profit). Consolidated revenue for 2016 is recorded at $3.56B.

The combined (NSC and manufacturing) financial result of $152.8M includes a recorded profit of $125.5M for Holden’s manufacturing arm. However, this result reflects a $128.1M payment received from parent company General Motors as part of ongoing corporate support to ensure an orderly wind-down of manufacturing and that all Holden’s employees are looked after. An additional $51.4M of financial support was also received from the Federal Government’s Automotive Transformation Scheme (ATS).

Furthermore, if GM Holden were continuing local manufacturing beyond 2017 a further $125.6M in asset depreciation would have been incurred. With the above figures incorporated, Holden’s manufacturing arm continued to operate at a significant loss.

Holden sold 94,308 vehicles in 2016, giving Holden a market share of 8.0 per cent. While this market share is down compared to 2015, Holden saw growth in key market segments with both the Trax and Trailblazer SUVs achieving record sales for the 2016 calendar year.

Holden Chairman and Managing Director, Mark Bernhard, said Holden’s 2016 financial results underlined again that Holden is consistently profitable as a full-line vehicle importer and National Sales Company operation.

“For the second consecutive year Holden has recorded a solid profit from our National Sales Company operations. This result highlights the strong profitability of our long-term business plans,” Mr Bernhard said.

“We’re facing challenges as a business and undergoing fundamental changes, there is no sugar coating that. But our consistent financial results highlight the underlying health of the business.

Now we need to keep our unwavering focus on growing sales, re-building our brand and putting our customers first. If we look after the fundamentals of our business, the rest will take care of itself.”

Holden remains a significant contributor to the Australian economy. In 2016, the company invested $69.1 million into R&D and paid combined taxes of $188.1 million.

Beyond 2017, Holden will retain a significant presence in Australia. A corporate headquarters in Port Melbourne will continue to employ hundreds of staff, combined with Holden’s world-class international design studio, ongoing engineering and technical team, a national parts and distribution centre and the iconic Lang Lang vehicle proving ground. Not to mention the thousands of employees across Holden’s dealer network right around the country.

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