Q3 2013 Renault SA Sales Conference Call
Oct 24, 2013 AM CEST
RNO.PA - Renault SA
Q3 2013 Renault SA Sales Conference Call
Oct 24, 2013 / 04:00PM GMT
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Corporate Participants
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* Thierry Huon
Renault SA - Director of IR
* Dominique Thormann
Renault SA - EVP & CFO
* Jerome Stoll
Renault SA - EVP & Chief Performance Officer
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Conference Call Participants
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* Thomas Besson
Kepler Cheuvreux - Analyst
* Kristina Church
Barclays - Analyst
* Rabih Freiha
Exane BNP Paribas - Analyst
* Philip Watkins
Citigroup - Analyst
* Charles Winston
Redburn Partners - Analyst
* Erich Hauser
ISI Group - Analyst
* Horst Schneider
HSBC - Analyst
* Gaetan Toulemonde
Deutsche Bank - Analyst
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Presentation
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Operator [1]
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Ladies and gentlemen, welcome to third quarter commercial results and Renault Group revenues conference call. I will now hand over to Mr. Thierry Huon. Sir, please go ahead.
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Thierry Huon, Renault SA - Director of IR [2]
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Good evening, everyone, and welcome to Renault's third quarter 2013 conference call, broadcast live and in replay versions on our Website. The presentation file and press release for this call are all available on our Website in the Finance section.
I would like to point out the disclaimer on slide two of this pack regarding the information contained within this document and, in particular, about forward-looking statements. I invite all participants to read this.
Today's call is scheduled to last 45 minutes. We have two speakers this evening, Jerome Stoll, EVP and Chief Performing -- Performance Officer, and Dominique Thormann, EVP and CFO.
The presentation will last about 20 minutes and will be followed by a Q&A session. If you don't have the time to take everyone's question in this session, Alain Meyer and I will be around to take your calls later.
Without further ado, I will pass the call over to Dominique for a few opening remarks.
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Dominique Thormann, Renault SA - EVP & CFO [3]
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Thank you, Thierry, and good evening, everybody. Before reviewing Q3 commercial results with Jerome in a minute, I would like to highlight the key takeaways from the third quarter.
Firstly, we have seen a stabilization of car demand in Europe, but still at a low level, supported by some signs of economic recovery. We therefore hope that the bottom is now behind us.
Conversely, we are experiencing some slowdowns in demand in emerging markets. This recent headwind has been exacerbated by adverse currency movements.
Throughout all this, Renault has managed to improve its sales momentum and gain market share, notably in Europe, Russia, and Brazil. This performance is supported by the success of our new models that Jerome will detail for you in a minute.
Lastly, as you will have read in our release, we maintain our guidance for the full year 2013.
I will now pass over the call to Jerome, who will review our commercial performance in the third quarter.
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Jerome Stoll, Renault SA - EVP & Chief Performance Officer [4]
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Thank you, Dominique, and good evening, everyone. And so, I will start my presentation on slide six with the market evolutions and our registration for the third quarter compared to the same period last year globally and for each region.
The global TIV is up by 4.6%, driven by China and North America, and over the period, Renault registrations are outperforming the market with a 7.3% increase, excluding Iran. Including Iran, the growth is 3.1%.
The European market drop seems to seize with a 2.5% increase for the quarter. The growth comes from UK, plus 11.6%, and with Spain benefiting from the PIVE scheme, plus 8.9%. France was only 1.2% below 2012. And in this context, the Group registered 10.2% more units than in 2012.
Eurasia, Euromed-Africa, and Americas are suffering falls of minus 4.2%, minus 4.6%, and minus 2.8%, respectively. The good news is that our sales are largely offsetting this downturn with an 11 -- 18.2% increase in Eurasia, a 2.9% increase in Euromed-Africa, and stable volumes in the Americas.
Asia-Pacific TIV is up 6.1%, driven by China, up 13.3%. Excluding Iran, our registrations in the region are up 6.6%. But, with Iran, our sales are down 30% -- 30.4% as we launch -- we lose 23K units in Q3 due to the political situation. In India, where the market is down 5%, we increase our penetration with largely stable volumes.
As you can see on the slide seven, the 3.1% sales increase represents 19K units. The growth comes mainly from Europe, where our sales went up by 27K units with France accounting for 24K units.
With 320K of registrations, our international operation lost 8K units. This represents a 2.6% decrease of sales. Asia-Pacific is the only region to lose some ground in the last quarter. But, excluding Iran, sales keep growing by 4.8%.
If you turn to slide eight, you see that our international registrations still represent more than 50% of our sales mix in Q3, even with an excellent performance in Europe and despite the unfavorable situation in Iran. This shows that our international expansion remains strong and long lasting.
Further evidence of our international expansion is that three out of four -- out of our top four countries are non-Europeans. Brazil is the second market for Renault, Russia the third, and Argentina the fourth.
To conclude on this slide, I want to highlight two points. Firstly, we are increasingly robust on our core market. Compared to last year, we gained 0.8 points to reach 9.5% of market share in our top 10 countries. Secondly, our dependency is well distributed among our main markets.
Now, let's detail our performance in each region. Let's begin with Europe, which was back to quarterly growth for the first time this year. Our market share went up by 0.6 points to reach 9.1%. As you can see on the top right of the chart, registrations went up by 27K units over the period. Only 2,000 are linked to TIV and market mix. 25K units are the result of our good sales performance.
The Group is gaining market share in France, 1.9 point, Italy, plus 1.8 point, Spain, plus 2.1 points, and in most of the other European countries. We remain at the 2012 level in Germany.
Dacia gets its highest market share ever last quarter with 2.1% of the European TIV.
As I will show you later, the new products Captur IV -- Clio IV, Captur, Sandero, are performing as expected or better. And a positive impact is now visible since momentum should remain positive as our order book reached almost two months of sales, not far from our 2007 level.
Slide 10 shows our year-to-date market share per sales channel for the five countries for which data is available. I want to stress that this more business down goes along with a better business approach. Thus, the Group is gaining market share on rental channel, plus 0.6 point, and fleet channel, plus 0.3 point. The new products are key in these results.
As an example, six out of 10 Captur are sold to private customers when three out of 10 are sold to fleets.
At the same time, we limit our share in the short-term rental channel, minus 1.9 point.
Compared to last year, the weight of each channel in the total TIV remained stable, as you can see at the bottom of the chart.
In the Americas, slide 11, our market share is up 0.2 point at 7.2%, driven by the best quarterly market share ever in Brazil and the highest quarterly sales ever in Argentina.
In Brazil, market share is up 0.4 point compared to 2012 at 7.1%. We are slowly regaining the lost ground we incurred due to the Curitiba plant closure for capacity expansion at the beginning of the year.
Sandero is the Renault flagship and ranks number 10 on the market with 72K units sold since January.
Also, in Brazil, Duster holds second position of the crossover segment with 33K units registered.
In Argentina, we have sold almost 40K units. Renault remains the third brand of the market and even reached the first one in September, the first position.
In Eurasia, slide 12, and despite unfavorable TIVs, minus 4.2%, Renault sales are still booming with an increase of 18.2%.
Renault's market share is now 6.6% in the region, up by 1.2 point compared to last year. In Russia, Renault remains the second brand behind our partner Lada with 7.1% market share, up by 1.5 point.
[M0 range] is performing. Duster is the fourth car sold in Russia with 20,000 units registered this quarter. It is the first crossover for that market.
With 12,000 and 10,000 units sold, Logan and Sandero are both in B segments top 10.
Our new frontier in the region will be the CIS, Belarus, Kazakhstan, and so on. On this market represents 200,000 units. Our market share is half of what we have in Russia. There are definitely opportunities to be seized.
In Euromed-Africa, slide 13, our market share is up 1.1 point at 14.9%. We increased our sales by 2.9% in the market that fell by 4.6%. We reinforce our strong positions in Turkey, Morocco, and Romania, Turkey, the sixth market of the Group this quarter. The sales are up 34.3% in a market that grows by 7.6%. That leads to a 3.4-point increase in market share.
In Morocco, the Group is selling four cars out of every 10 with a market share up by 5.2 points.
Romanian sales are up 32.7% in a market that grows by only 3.5%. In this region, we are facing very contrasted market evolution with market down 23.4% in Algeria, 5.6% in Morocco, but up also 7.6% in Turkey and 5.1% in Eastern Europe.
In this context, our best answer is the freshness and the attractiveness of our offer. Clio IV, fourth car in Turkey, first in B segment, third car in Algeria, Sandero II, best seller in Q3 in Morocco, Fluence Phase II, third car in Turkey, and Symbol just being introduced in the region will contribute to an acceleration of our sales within the next months.
Our new frontier in this region is Africa. We are creating this year the conditions of a future high level of performance by signing importers' contracts in Libya, Nigeria, Ghana, and Kenya.
Let's switch to Asia-Pacific and on the slide 14. The shot on the top right of the slide shows clearly the main reason for our fall of 19K units compared to Q3 2012. It's Iran.
The stoppage of activities in this country cost us 23K units this quarter, which cut our sales performance in the region by 30%. As a consequence, market share drops by 0.3 point to 0.5%.
Without Iran, we would hold market share, and our sales would be up 6.6% over the quarter. That's because there is good news for us in the region. Q3 is another strong quarter in India. In a market that drops 5%, we stabilize our sales at minus 0.6%, increasing our market share by 0.1 point to 1.6%.
In Korea, the RSM revival plan starts to deliver from a sales point of view. Sale -- Renault Samsung Motors made the fourth consecutive month with sales results above 2012. It is 16.4% in Q3 and a gain of 0.4 point of market share, reaching 4%. We expect to continue this way over the coming months. And RSM will be helped by the launch of Captur-based [country].
Our performance is also on the rise across our importers' market. The sales are improving by 62.3% in Israel, by 11.9% in Saudi Arabia, by 27.7% in Australia, and more globally by 23.6% in the [Indiasian]. The best sellers in the region are Duster and Logan, 45K units and 31K units, respectively, on year to date.
Before wrapping up this chapter on commercial performance, I would like to illustrate the positive results of our product offensive on slide 15. We sold more than 250K units Clio IV since the beginning of the year. Clio IV is the number one car in France, the first imported car in Italy. It is a conquest car in Euromed, clenching the third place of the market in Algeria and the fourth place in Turkey.
Captur performance is over expectations with already 52K units sold. In Q3, its first full quarter, Captur becomes number one crossover of the French market, leader of the big crossover segment in Europe.
One last word about Duster, it remains the Group's best-selling vehicle year to date with 276K units registered worldwide. It is the cornerstone of our international expansion with 76% of its sales outside Europe.
The success of our new products and our steady international expansion will be our best assets for the fourth quarter to achieve our yearly objectives.
Thank you for your attention. And I hand over to Dominque, who will now review our third quarter revenues.
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Dominique Thormann, Renault SA - EVP & CFO [5]
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Thank you, Jerome. I will start this part of the presentation with the change in third quarter revenues compared to last year on slide 17.
For your information, the 2012 figures on the column to the left are restated for the retrospective application of IFRS 11 on joint arrangements and for the deconsolidation of Iran, which occurred on July 1st, 2013. You will find a reconciliation table in the appendix.
As you can see, Group revenues decreased 3.2% to EUR7.998 billion in the quarter. The contribution from the automotive division decreased 3.4%, while the contribution of sales financing is up 0.4%.
I will start the analysis with the review of the automotive division on slide 18. On this slide, we show the contribution to the change in automotive revenues for the third quarter broken down by item.
From the left-hand side of the slide, the first item is foreign exchange, which was negative with a 5.7 points impact, reflecting primarily the fall of the Argentinean peso, the Brazilian real, and the Russian ruble, in addition to several other currencies of lesser importance for us.
The second item, volume, is almost flat at plus 0.1 points as our positive sales momentum, detailed by Jerome in his presentation, was offset by the reduction in inventories in the independent dealer network.
Next, geographical mix accounts for a positive 1.2 points, reflecting the improvement of our European sales. The model and version mix effect is negative in Q3 at 1.3 points, which shows the contrasted evolution between our B and C segment sales.
The price effect was positive for 0.9 points. This demonstrates our pricing discipline on the European market, but it is also the reflection of price increases decided in certain countries outside Europe in order to offset currency weakness.
Sales to partners contributed positively for 1.3 points, thanks to our built-up and component business with third parties.
The last item, others, is flat and represents the activities outside the new car business, mainly spare parts, non-new car sales, as well as restatements related to buyback commitments.
If you turn to slide 19, as I just explained, we witnessed a strong destocking in the quarter at independent dealers from 367,000 units to 260,000 units. At the same time, Group inventories increased by 103,000 units. All in all, total inventories ended slightly under last quarter's level at 503,000 units.
Due to the traditional seasonal pattern, these inventories represent 75 days of sales. However, on a forward-looking basis, our inventory level is about 67 days, in line with the June level. We acknowledge that this level of inventory is a bit too high. But, at a time when sales momentum seems to be gaining traction, we are not keen to cut production in Europe and take the risk of missing business opportunities.
Given our current visibility, we do not expect to reduce significantly our total volume of inventory in Q4. But, we do target to be below 70 days of sales by the end of the year.
I will now move onto to slide 20 and comment RCI's commercial performance. The number of new contracts written by RCI Banque in the third quarter of 2013 increased by 25% versus the same period of 2012. This number is inflated by the retroactive consolidation of the -- at the 1st of January of our Turkish joint venture. Without this impact -- the impact of this consolidation, the increase would've been 13%.
New financings in the quarter increased at a slower pace than the number of new contracts at plus 15%. On a like-for-like basis, excluding the Turkish joint venture, the increase would've been 10% as the average financed amount per contract was lower due to a negative foreign exchange conversion impact.
Lastly, average loans outstanding increased by 2.5% compared to the third quarter of 2012.
Before moving onto the Q&A session, I will turn to the last slide, number 21, which gives you our outlook for 2013. As I mentioned in my preliminary remarks, we maintain our guidance for the full year 2013, which calls for unit sales growth, a positive automotive margin, and positive automotive operational free cash flow.
This concludes our presentation. Together with Jerome, we will take your questions. And so, I will now hand over the call back to the conference operator. Thank you very much for your attention.
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Questions and Answers
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Operator [1]
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Thank you. (Operator Instructions). We have a question from Thomas Besson from Kepler Cheuvreux. Please go ahead, sir.
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Thomas Besson, Kepler Cheuvreux - Analyst [2]
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Thank you. I've got three quick questions, please. First, can you comment on your ability to address the FX impact on earnings? Second, can you comment on the timing of the launch of the second generation of Logan and Sandero in emerging -- in the different emerging markets you're mainly exposed to? And finally, can you comment on RCI contribution in H2, given the relativity in interest rates? Thank you.
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Dominique Thormann, Renault SA - EVP & CFO [3]
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Hi, Tom. It's Dominique. So, I'll -- why don't I take number one and three and then hand over to Jerome for your question on the two cars?
The FX impact on earnings, well, today's call is on the top line. So, as a rule of thumb, I think, if you use what happened in H1 and use that as a split between the impact of the top line and to the operating line, you'll rough -- you'll be in the ballpark. It's roughly the same.
A lot of this doesn't fall through to the -- to earnings because there are many offsets on the sourcing side, of course.
And then you must bear in mind also that some of this impact at the top line is conversion when we convert our revenues in a country that has a lower -- that has a depreciated currency compared to the euro. So, it's a conversion impact in addition to just the flow impact.
The -- but, it is a headwind. We called it out as a risk in -- on the call back in July, if you remember. We are taking pricing action in some cases to offset this. So, roughly, if you want to work with the same ratio that we had in the first half, which is about a third of the impact, that's a fair -- for modeling purposes, that would be a fair assumption.
On the RCI side, there -- I think RCI's having a good year. There's nothing that I'm seeing right now to be a real cause for concern. If anything, if you look at the way our secondary market is trading, our spreads have come in considerably. They've tightened in the last month, six weeks actually. So, funding is certainly not a concern. And as a matter of fact, we have very ample liquidity, and our spreads are lower than they were this time last year.
So, I'm not -- and as you know, we don't take any interest rate risk in RCI. So, it's a pure spread business. That's what I can tell you at this stage. Jerome?
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Jerome Stoll, Renault SA - EVP & Chief Performance Officer [4]
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Yes, to answer your question regarding Sandero and Logan outside Europe, so what I can say that the start of sales for Logan in Algeria and Russia will start first half of 2014. And Sandero will follow in Russia and Brazil for the second half 2014.
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Thomas Besson, Kepler Cheuvreux - Analyst [5]
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Thank you very much.
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Operator [6]
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Thank you. Our next question is from Kristina Church from Barclays. Please go ahead.
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Kristina Church, Barclays - Analyst [7]
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Yes, thank you for taking my question. Kristina Church from Barclays. Two questions. Just a little bit more color on the decrease in dealer inventory, talking about a strong order book. I was just wondering exactly why the dealers are pulling back so much and what you expect. I know you said you're expecting inventory levels to stay high in Q4. Do you expect the split between your own inventory and dealer inventory to stay the same?
And then a much more -- to the wider question on the Nissan alliance, just wondering if we should expect to hear anymore updates around that and around how much you're working together on the alliance going forward, anymore numbers in that, whether there's any update to that coming at some point into next year. Thank you.
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Dominique Thormann, Renault SA - EVP & CFO [8]
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Kristina, hi. Okay. On the inventory question, what I told you is that, on a forward-looking base, we're look at around 67 days. And to the end of the year, I'm expecting on a backward-looking basis, so the published number, to be below 70.
As you know, the seasonal selling patterns will impact where that stock is held, whether it's company owned or dealer owned. Some of it is in long supply chain routes. Others are in shorter destinations. We don't provide a forecasted split between dealers and dealer-owned and company-owned stock.
What I said is that, at the end of the year, because this is a -- we have an order book, which Jerome showed you has been increasing, particularly in Europe. So, there are high-demand models that are going -- that are flowing through right now. And predicting, it's a ratio. So, predicting where the -- we know what our sales -- our production pattern's going to be for the remaining quarter. Then it's a question of what the actual sales will have been in the quarter that will give you that forecasted number.
On the Nissan alliance, there's no update that we have that we've got scheduled right now. We're working on everything that's been announced recently, a lot of the vehicles to come. I think you know we've been talking about the -- our modular platform approach, CMF. A lot of that work is -- and that activity is ongoing, as scheduled. So, there's nothing really more to update beyond what we've said on the alliance so far.
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Kristina Church, Barclays - Analyst [9]
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Thank you.
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Operator [10]
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Thank you. We have a next question from Mr. Rabih Freiha from Exane. Please go ahead, sir.
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Rabih Freiha, Exane BNP Paribas - Analyst [11]
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Hello. Rabih Freiha from Exane. Thank you for taking my questions. I have three of them, please. First of all, could you give us a bit more color on the inventories by region? You talked about good momentum in Europe. I would like to know how much of these inventories that you have today are related to your -- how much out of Europe, please, is my first question.
The second one would be -- I'm sorry to ask this again this quarter -- if you maintain your flat working [capital] guidance for the year.
And third, your close competitor mentioned renewed pricing pressure in the market. Can you please tell us, what's your view on that? Thank you.
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Dominique Thormann, Renault SA - EVP & CFO [12]
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Hi, Rabih. On the inventory question, I think the best -- we don't provide splits by region, but I think you see that -- if you correlate it to where our sales occur, you're going to come pretty close. So, I think we reported 50 -- roughly, we're 50-50, a little bit more non-European sales in the quarter. So, as a -- for modeling purposes and as a rule of thumb -- it's the number of units are going to be split that way.
Many of these are in emerging markets. Don't forget that the supply chain on some routes is quite long, just because you're holding it through while you're clearing customs. And so, that's the inventory one.
On working capital, yes, more or less, yes, flattish. I can't give you within a few million euros, but yes, you can still use that as guidance right now.
And on pricing, I'll hand over to Jerome.
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Jerome Stoll, Renault SA - EVP & Chief Performance Officer [13]
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Yes, on pricing, so, I may split the subject into two, the Europe and outside Europe. I would say that, in outside Europe, with the trend which is now negative in some of the countries where we were -- we are quite strong, it's clear that the pressure is getting higher. Nevertheless, as you could have seen, we are performing quite well with the products which are attractive enough in order for us to catch market share despite these headwinds.
Regarding Europe, I would say what we experienced in Q2 and Q3 was rather unstabilization in the rate of rebates. The rebates increased a lot in -- during a period of time first quarter and last quarter of last year. But -- and we experienced a stabilization of these rebates despite the fact that the global European market, as you know, in terms of size is at the level of the 1995 level.
When you look at the passenger car and ATV, the total global market is today at the level of 1995. Just looking at the passenger cars, it's even worse.
So, despite the situation, we noticed that it was a kind of stabilization, even if at high level stabilization of rebate. But, now, we experience that these trends may be becoming a little bit worse.
Regarding our specific brand, we are for the time being obviously in this battle. But, we don't want to lead the rabbits, as we have always said before. So, our pricing policy has not changed. We want to be above our competitors in terms of pricing positioning.
And I would say that, with the introduction of Captur and Clio, the new products which are very, very attractive, and you can see them with the market share and the increase of volumes that I talked about earlier, there is two aspects that I wanted to say, is that the discount that we can offer to the customer is rather limited because we consider that the product's attractive, and the customer consider the same.
And the second aspect, which is -- this is I would say rather for retail. But, for fleet, I would say that these products can experience a higher residual value that can allow us to decrease again the discount that we used to offer on fleet. And for the time being, we are I would say, despite this price pressure, we are in line with what we have said earlier.
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Dominique Thormann, Renault SA - EVP & CFO [14]
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Rabih, one quick -- this is Dominique again. One just clarification, further clarification on the non-European or emerging market inventories. Clearly, the fall in the emerging markets in the summer months adversely affected the number of the supply, so just as an additional clarification.
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Rabih Freiha, Exane BNP Paribas - Analyst [15]
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Okay. Thank you. Just to make sure I heard correctly in -- regarding pricing, so Q1 and Q2, we saw stabilization in rebates, but a deterioration in Q3, right?
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Jerome Stoll, Renault SA - EVP & Chief Performance Officer [16]
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Yes, we have -- we start to feel some sign after the summer period of time that rebates are becoming a little bit higher. So, the pressure is becoming tougher. But, so far, Renault is still in line with what we have declared and because of the success of the new product that we have launched in Europe.
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Rabih Freiha, Exane BNP Paribas - Analyst [17]
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Okay. Thank you very much.
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Operator [18]
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Thank you. Our next question is from Philip Watkins from Citi. Please go ahead, sir.
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Philip Watkins, Citigroup - Analyst [19]
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Good evening. And thanks for taking my question. Just I'll follow up a bit really on that one, on the pricing. So, in Q3, 0.9 points, and did you split out -- sorry, there's a bit of an echo on this line. Can you hear me?
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Dominique Thormann, Renault SA - EVP & CFO [20]
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Yes, you're coming across.
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Philip Watkins, Citigroup - Analyst [21]
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I can't hear myself. Sorry. It's -- I've got 0.9 points. How much is -- was emerging markets, and how much was developed markets was my first question.
The second one was on Brazil and Russia. I don't know if you've got a flavor really of how those markets might progress in 2014.
And finally, I'll just try it, but on the second half, I know you've got an operating margin target for growth. Do -- positive. Do you expect a positive operating margin in the second half of this year?
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Dominique Thormann, Renault SA - EVP & CFO [22]
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Yes, why don't I take -- well, the last question, yes, the answer is yes.
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Philip Watkins, Citigroup - Analyst [23]
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Yes.
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Dominique Thormann, Renault SA - EVP & CFO [24]
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On your pricing question, we don't give -- not on a quarterly call. We'll give you a bit more flavor on the full year for breakdowns in pricing. But, it is positive in the quarter.
And on your Brazil and Russia questions?
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Jerome Stoll, Renault SA - EVP & Chief Performance Officer [25]
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Yes, on Brazil and Russia, I would say that these are emerging countries. And as you know perfectly, emerging countries are not stabilized countries, and there is generally not a welfare system or this kind of amortization of the economy. And therefore, it's obvious that, for Brazil, we experienced a slowdown. But, I'm quite confident that Brazil will recover because, basically, the macroeconomies are still good.
I would not say exactly the same thing for Argentina, where the macroeconomy is maybe a little bit more of concern. But, for 2014 in Brazil, we expect a moderate growth and have this country on a positive TIV.
For Russia, basically, it's the same. We expected I would say a rather moderate growth. But, frankly, with the new introduction of end-of-life taxes, we don't know. That has just been promulgated recently. We don't know exactly what will be the impact on the market. And because this may affect the local carmaker with this additional tax, which is quite interesting to notice, and we're going to see what will be the impact on the market because, obviously, part of this tax will be repriced in our cars. So, there might be some evolution.
But, before the introduction of this new measure, we expected the market also to be on moderate growth, be positive at least.
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Philip Watkins, Citigroup - Analyst [26]
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Thank you. What is the end-of-life taxes? I'm not very familiar with it. How large would that be?
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Jerome Stoll, Renault SA - EVP & Chief Performance Officer [27]
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No, I think that this is just a measure that has been announced very recently. The complete program around these taxes is not yet completely defined. I suggest that you contact directly Thierry Huon to get additional information because it may take more time on this subject. It's very recent.
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Philip Watkins, Citigroup - Analyst [28]
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Thank you.
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Operator [29]
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Thank you. Our next question is from Charles Winston from Redburn Partners. Please go ahead, sir.
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Charles Winston, Redburn Partners - Analyst [30]
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Yes, thanks. Two questions from me as well. Just the first one, given that we're looking at revenue movements sort of ex-Iran in all periods because you've restated, would I be right to assume that the 0.1% volume that you show in the bridge is comparable with the 7.3% delivery growth ex-Iran? In other words, the inventory destock actually took about 7 percentage points off the revenue growth. Just wanted to clear that one up.
And the second one is the impact of deconsolidating Iran on the profit side. Again, I know this is a revenue call. But, if we could get some sort of steer as to what Iran contributed in profit or loss in the first half, I'm guessing a bit of a loss, given the movement in FX, so that would help us get some sort of idea as to what that impact would be in the second half, when modeling on the profit side.
Obviously, you've shown us the deconsolidation effect at revenue, just be quite handy on the profit. Thanks.
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Dominique Thormann, Renault SA - EVP & CFO [31]
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Yes, hi. So, what we tried to do to make it simple for you is we -- the 2012 column is restated. So, Iran's not in there. So, in the bridge and all of the variances that we're showing to -- that we're showing, at all stages is excluding Iran.
So, there's no impact. And you're not going to find it in any of your -- in any of the quarterly bridges.
Now, don't forget, Iran was a KD, kits business. So, we would send components. We had no local assets and no manufacturing facilities. So, it was a purely arms-length business with local suppliers or local partner -- assembly partners.
So, the contribution, once again, was -- it was a -- at the end of the day, it was a relatively small contribution. In the particular quarter that we're showing you the impact, Jerome showed you 23,000 units that were taken out of Q3. I think full-year 2012 out of memory was somewhere around -- so, I'm thinking, just speaking out of memory, 80,000, 90,000 units full year. So, that's the order of magnitude that we're talking about.
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Charles Winston, Redburn Partners - Analyst [32]
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Okay. So, just because I'm -- just want to be totally clear. Bearing in mind the 7.3% was the ex-Iran figure, the 7.3% is therefore comparable with the 0.1%. In other words, that delivery figure is then comparable with the 0.1% in the bridge.
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Dominique Thormann, Renault SA - EVP & CFO [33]
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Yes, the bridge is -- yes, it's been taken out of the bridge, yes.
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Charles Winston, Redburn Partners - Analyst [34]
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Fantastic. Thank you.
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Operator [35]
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Thank you. We have a next question from Mr. Erich Hauser from ISI Group. Please go ahead, sir.
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Erich Hauser, ISI Group - Analyst [36]
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Good evening. Thank you very much. Just a very quick follow up for me. I wanted to hear a bit more about your thoughts regarding Brazil going into next year. Obviously, we see the reintroduction of the full-blown IPI tax at the end of this year. So, I just wanted to see where were you seeing -- in Q4, we should see some pre-buy effect of any description and whether you see any risks to your previous statement that you still see positive growth from Brazil in 2014, given these rising taxes. And perhaps these could even have some impact on pricing. Thank you.
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Jerome Stoll, Renault SA - EVP & Chief Performance Officer [37]
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No, I think that, as far as we are concerned, as you know, we -- Brazil was a specific -- 2013 was a specific year for us because we closed a plant in the -- very early in the year. So, and we had to catch back the volume in the remaining part of the year. So, what we have in the last quarter is in line with a level of sales, which will be above 2012 or slight -- moderately above 2012. And we are in line with what the -- our refocus for last quarter is today.
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Erich Hauser, ISI Group - Analyst [38]
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Thank you.
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Operator [39]
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Thank you. Our next question is from Horst Schneider from HSBC. Please go ahead, sir.
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Horst Schneider, HSBC - Analyst [40]
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Good evening. On (inaudible) just one question is left. Basically, again, on the price trend, I'm puzzled on your comments regarding pricing in Europe because we heard today from [Ford] that the net pricing was positive in Q3. We heard yesterday from Peugeot as well that the price trend has improved. So, I want to get some more details where the price pressure in Europe is really coming from. Is that constrained to certain segments or countries? So, any clarification would be great. Thank you.
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Jerome Stoll, Renault SA - EVP & Chief Performance Officer [41]
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When you compare the different presentations made by the other brands, you have to be -- I guess we have to be careful that the comparison is made on the same period. What I was talking about is Q3 on Q3. I don't know whether the other -- we're talking about the same period of time.
So, what I would say is that, basically, we are in price positioning. We have already explained in the other presentation that our strategy was to increase relatively to the other carmaker high price positioning. And I can tell you that, at the end of August compared to the end of May, we are in that trend. We are continuing, keep on going on this evolution.
But, as you know, it's a relative trend. And it does not take into account the global price position of the market and so relatively to Renault compared to the others. So, we are still improving. But, the global market is still under price pressure, no doubt about that.
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Horst Schneider, HSBC - Analyst [42]
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So, but, it's not constrained, let's say, only to the B segment or C segment. So, you would say it's in both B and C for you.
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Jerome Stoll, Renault SA - EVP & Chief Performance Officer [43]
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Yes, you mean B and C segment?
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Horst Schneider, HSBC - Analyst [44]
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Yes.
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Jerome Stoll, Renault SA - EVP & Chief Performance Officer [45]
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Yes, no, the -- for us, the B segment is really very positive because, as I explained, the success of the -- of Sandero, of Clio and Captur are really quite impressive. So, we are not experiencing this price war for the time being on this specific segment. We can control our discount, as it was expected.
On the C segment, you are right to mention that, because our line, our products, our model on this segment are in a different stage of development, it's obvious that we are suffering a little bit more. And we are losing some volumes. And the volumes that we're losing is because we do not want to enter completely on this price war.
And -- but, with introduction of the NBI, with the introduction of the new engines, which are quite performance, I guess that we're going to track the additional customer and without having this price war completely affecting our accounts.
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Thierry Huon, Renault SA - Director of IR [46]
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Horst, maybe to clarify, what Jerome said at the beginning was that his comments on pricing was on a sequential basis, quarter three versus quarter two and versus quarter one, when the comments of the competition's might be on a yearly basis. This might explain the difference.
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Horst Schneider, HSBC - Analyst [47]
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Okay. Thank you.
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Thierry Huon, Renault SA - Director of IR [48]
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I'm sorry, but we have time left only for one more question. Who is next in line?
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Operator [49]
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Our next question from Mr. Gaetan Toulemonde from Deutsche Bank. Please go ahead.
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Gaetan Toulemonde, Deutsche Bank - Analyst [50]
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Good evening. I'm going to be very quick. My question is simple. It's for Jerome. When you give a guidance to increase your volume for the full year compared to last year, is it like for like, or is in absolute term, i.e. the fact that Iran is not there anymore, do you restate that, or it's in absolute term?
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Jerome Stoll, Renault SA - EVP & Chief Performance Officer [51]
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It's on year on year, everything included.
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Gaetan Toulemonde, Deutsche Bank - Analyst [52]
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Okay. That's perfect. So, that's underlying a very strong fourth quarter. Thank you.
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Jerome Stoll, Renault SA - EVP & Chief Performance Officer [53]
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Thank you.
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Thierry Huon, Renault SA - Director of IR [54]
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Okay. Thank you very much for being on the call this evening. And Alain and myself will be available if you have further questions. Have a good evening. Bye.
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Operator [55]
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Thank you. Ladies and gentlemen, this concludes the conference call. Thank you, all, for your participation. You may now disconnect.
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