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Fiat reports first full year net profit since 2000

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MILAN (AP) _ Fiat SpA posted a fourth-quarter profit of 38 million euros ($46.3 million US) on Monday and said it had a net profit for the full year for the first time since 2000 on gains from asset sales and progress at its core auto division.

The quarterly profit compared with a loss of 550 million euros in the same quarter a year earlier. The Turin-based maker of cars and trucks also said it earned 1.33 billion euros ($1.62 billion) in 2005, reversing a 1.63-billion-euro loss in 2004.

That was ahead of analysts' forecasts of a net profit of 1.35 billion euros ($1.64 billion), and Fiat shares were up 1.1 per cent to 8.24 euros ($9.97) in Milan trading.

Fourth-quarter revenue rose 7.5 per cent to 13.14 billion euros ($15.89 billion) from 12.22 billion euros a year earlier, while full-year revenue increased two per cent to 46.54 billion euros ($56.29 billion) from 45.64 billion euros.

The profit is a boost for CEO Sergio Marchionne, less than a year after he took the helm of the ailing auto division and pledged to cut costs.

Moody's Investors Service changed Fiat's outlook from negative to stable due to its improved operating performance and a ``sizable reduction'' in its industrial net debt, which was 3.2 billion euros ($3.9 billion) _ down from 9.4 billion euros at the end of 2004.

``The recent trend improvements at Fiat Group, most notably over the last 12 months, will need to be sustained and closely controlled if Fiat is to strengthen its overall financial profile on a more permanent basis,'' Moody's said in a statement.

``The success of new models from within Fiat Auto, in particular the Grande Punto and a new C-segment model, the ability to reorganize sales channels across its key geographies and the success of recently announced ventures and associations with other auto groups will also play a central role in the future shape of Fiat Auto's profile,'' it added.

In November, Fiat and Ford Motor Co. said they had signed an agreement to collaborate on small cars, completing a deal to codevelop new models due in 2007 and 2008.

Also Monday, Fiat also said it plans to issue a seven-year euro bond, the Italian carmaker's first debt issue to capital markets since it lost its investment grade credit rating in late 2002. The company said it would decide the amount and price of the bond issue according to market conditions.

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Fiat reports first full year net profit since 2000
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