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Peugeot says economic tailwinds may speed recovery plan

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PSA Peugeot Citroen could reach its main recovery goal early, its chief financial officer said on Monday, as the French carmaker's shares rejoined the benchmark CAC-40 index after a two-and-a-half-year absence.

[PARIS] PSA Peugeot Citroen could reach its main recovery goal early, its chief financial officer said on Monday, as the French carmaker's shares rejoined the benchmark CAC-40 index after a two-and-a-half-year absence.

Peugeot will "go after the 2 per cent operating margin objective as soon as possible", Jean-Baptiste de Chatillon said before ringing the opening bell in Paris.

A weaker euro and cheaper raw materials constitute "a more favourable alignment of the planets" than was assumed when Peugeot pledged last year to restore auto-division profitability to a 2 per cent margin by 2018, the finance chief said.

Peugeot shares sank 4.7 per cent last week after a March 17 investor day at the company's main research and development centre outside Paris, with some analysts saying the market expected greater ambition. "In a bull market it seems people quickly come to expect bigger and bolder and faster and higher," Bernstein analyst Max Warburton said.

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"But we mustn't forget that PSA has only been out of intensive care for a short while."

The shares were down a further 1.6 per cent at 15.54 euros less than three hours after Peugeot's return to the CAC-40, which had been announced on March 5.

REUTERS

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