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Spyker cuts Saab's 2010 production plan as group loss widens

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Spyker cuts Saab's 2010 production plan as group loss widens

Saab owner Spyker reported a net loss of 39.9 million euros compared with a 4.06 million-euro deficit a year earlier.

October 29, 2010 09:01 CET

UPDATED: Oct. 29 11:45 CET

STOCKHOLM (Bloomberg) -- Spyker Cars NV, the Dutch supercar maker that bought Saab in February, lowered this year's production forecast for the Swedish brand as the costs of the takeover led to a wider third-quarter loss.

The net loss was 39.9 million euros ($55.4 million) compared with a 4.06 million-euro deficit a year earlier, Zeewolde, Netherlands,-based Spyker said Friday in a statement. Sales jumped to 275.5 million euros from 1.1 million euros as Saab began contributing revenue.

Saab was on the brink of collapse until Spyker bought the Trollhattan-based carmaker from General Motors Co. The brand resumed production in March after a break of two months, and is focusing on rolling out the new 9-5 sedan. The Dutch parent company reiterated that it aims to become profitable in 2012 as Saab reaches 120,000 annual vehicle sales.

“The group's medium-term goal is to establish Saab as an independent, financially viable, niche premium car manufacturer,” Spyker said. “The board continues to carefully balance the need for cash to fulfill the working capital and development plans of Spyker in view of the priorities and cash needs of the group.”

Saab's production target for 2010 was cut to 30,000 to 35,000 cars from a plan in August to build 45,000 vehicles. That is down from an original goal of making 50,000 cars this year.

Spyker said the unit has needed longer than expected to recover from the plant shutdown and start of liquidation proceedings early this year. The company also reiterated a goal of selling 80,000 cars in 2011.

Spyker has gained 9.3 percent in Amsterdam trading since the company bought Saab on Feb. 23 for $74 million in cash and $326 million in preferred shares.

Spyker CEO Victor Muller wants to list the company on the Stockholm exchange by about April 2011, he said Sept. 30. The shares would probably trade in both Amsterdam and Stockholm for a period and eventually delist from the Dutch market, Muller said.

Looking to expand

Spyker is turning to Russia and China to sell a range of new premium Saab models that it hopes will generate higher margins than under GM's ownership.

Market expansion is the priority in this quarter and and the first quarter of 2011 and there are plans to have agreements in place for China and Russia before the end of the year, Spyker said.

Last month, Spyker concluded a deal for Saab to use BMW AG four-cylinder 1.6-liter turbocharged gasoline engines for its new 9-3 model starting in 2012.

At the end of the third quarter, Spyker's liquidity was 450 million euros ($625 million) including undrawn European Investment Bank facilities of 255 million euros.

Spyker said Friday it is still finalizing its valuation of the Saab assets and that it was "not unreasonable" to expect the value to be adjusted upwards.

Read more: http://www.autonews.com/apps/pbcs.dll/article?AID=/20101029/ANE/310299913/1198#ixzz13lJiahqV

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Spyker Drops as Saab Production Goal Cut, Loss Widens

By Ola Kinnander - Oct 29, 2010 5:59 AM CT

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Spyker Cars NV, the Dutch supercar maker that bought Saab Automobile this year, fell the most in nine months in Amsterdam trading after cutting the Swedish unit’s production goal as the third-quarter loss widened.

Spyker dropped as much as 1.09 euros, or 28 percent, to 2.84 euros, the biggest intraday decline since Jan. 28, and was down 18 percent as of 12:57 p.m. That pared the stock’s gain this year to 51 percent, valuing the Zeewolde, Netherlands-based manufacturer at 64 million euros ($89 million).

The net loss was 39.9 million euros compared with a 4.06 million-euro deficit a year earlier, Spyker said today in a statement. Saab will build 30,000 to 35,000 cars this year, down from its plan in August to make 45,000 vehicles this year and an initial target of 50,000 to 60,000 cars.

“It’s disappointing they had to adjust the production target for the second time,” said Martin Crum, an analyst at Amsterdams Effectenkantoor BV who recently started covering Spyker and will “soon” have a recommendation on the shares. “That’s the big negative that’s pushing the stock down.”

Saab was on the brink of collapse until Spyker bought the Trollhaettan-based carmaker from General Motors Co. on Feb 23. The brand resumed production in March after a break of two months, and has been focusing on setting up dealerships and introducing the 9-5 sedan. Spyker reiterated that it aims to become profitable in 2012 as Saab sells 120,000 cars a year.

Reversing Liquidation

The reduced target for 2010 stems from Saab taking longer than expected to recover from the plant shutdown and the reversal of liquidation proceedings, Saab Chief Executive Officer Jan-Aake Jonsson told reporters on a conference call. Restoring ties with suppliers contributed to delays in the 9-5’s rollout, he said.

“You will not sell product that’s not on the showroom floor,” Spyker CEO Victor Muller said on the call. “It’s been a tremendous fight to fill the pipeline. This is now finally starting to happen.”

Saab’s future is “going to be difficult,” said Crum, the Amsterdams Effectenkantoor analyst. “When Spyker bought Saab, the factory was totally shut down, and of course it took a huge effort to get things up and running again. On the plus side, the company reaffirmed its target for 2011 and 2012.”

Muller reiterated his goal today of listing the company on the Stockholm exchange by April 2011, saying Spyker “definitely” wants its shares to trade simultaneously in Stockholm and Amsterdam initially. The company will consider dropping the Dutch listing “if it turns out that the Amsterdam market is not sustainable because the trading volumes are not high enough,” he said.

link:

http://www.bloomberg.com/news/2010-10-29/spyker-stock-drops-as-saab-auto-2010-production-goal-cut-net-loss-widens.html

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