2019 was very good indeed, but new orders continued to fall in 4Q19
Volvo’s revenue of SEK432bn was in-line with our expectation while EBIT of SEK48bn was above our SEK42.7bn. The group’s profits clearly benefited from currency tail-wind. All divisions suffered falling order volumes in the last year. The rates of decline were between -1% (Construction Equipment) and -21% (Volvo Penta). Trucks saw its orders fall by 29%, but the rate of decline moderated to -10% in the last quarter. This is a clear indication that 2020 will be much tougher.
30 Jan 20
Volvo to sell Nissan Diesel to Isuzu
Volvo is the Western hemisphere’s second largest truck producer (226k in 2018) after Daimler (>500k) and says that it intends to form a strategic alliance with Japanese Isuzu (532k trucks of all weight classes plus SUVs and Pick-up trucks). In a first step, Volvo sells its Japanese operation (called UD) to strengthen the two companies’ position in heavy trucks.
18 Dec 19
Q3 19 was not as smooth as expected
Orders for new trucks fell sharply in the last quarter and a slight fall was also experienced in Construction Equipment. Although truck deliveries fell as well, the divisional operating margin was slightly up. However, Construction Equipment has started to experience a slight profit margin fall.
18 Oct 19
US truck sales and Caterpillar's mining equipment sales still strong
Trucks and Construction Equipment contribute a total of 85% to Volvo’s consolidated sales and almost 90% to its EBIT. US heavy truck sales were up by 11% in the last month and Caterpillar’s worldwide machines sales increased by 4% in all of the last three months.
15 Sep 19
Q2 19 was another superb quarter
Volvo’s revenue and earnings are generated with trucks (63% and 64% in H1 19, respectively) and construction equipment (22% and 28%). These highly cyclical businesses have continued doing very well in Q2, but trucks have started to see falling order inflow as have buses.
18 Jul 19
Earnings and dividend higher than we had anticipated
Although Volvo suffered a charge of SEK7bn from the early degradation of an emission control component, it has delivered what we had anticipated. The reasons for the excellent profit number were SEK weakness plus much higher capacity utilisation. However, a further margin increase is unlikely in 2019 as order inflow growth has clearly moderated as of late.
30 Jan 19
SEK7bn provision for emission problem
Volvo has long tried to suggest that it is producing ‘green‘ trucks but management has discovered that one emission control component is degrading faster than expected. This translates into higher emissions and it forces Volvo to make the above provision which represents more than 25% of our projected 2018 Truck division’s EBIT. The company’s press release suggests that this provision only covers initial costs such as the testing of vehicles, statistical analysis and the dialogue with the relevant authorities. Subsequent recall costs associated with the implementation of corrective measures are expected to burden divisional earnings at a later stage.
04 Jan 19
SEK1.5bn profit from disposal of majority stake in WirelessCar
Volvo is selling a 75.1% stake in its fully-owned subsidiary WirelessCar to VW. The disposal price is SEK1.1bn, which translates into the above profit, i.e. the company currently shows negative equity. The transaction is expected to be finalised in H1 19. The subsidiary provides connected vehicle services and solutions to global producers of passenger cars as well as commercial vehicles. By keeping a minority stake, Volvo will continue to have access to the know-how and it will continue to focus on connected solutions for its trucks. WirelessCar had 3m connected vehicles around the globe in 2018 and turnover is projected to reach SEK0.5bn this year.
19 Dec 18
Volume, revenue and profit growth accelerated in Q3
Volvo’s Q3 revenue increased by 20% to SEK92bn which brought the ytd number to SEK285bn (+17%). The respective EBIT growth rates were +38% (to SEK10.2bn) and +31% (to SEK30bn). We had expected a 9M revenue number of SEK280bn and EBIT of SEK28.6bn.
19 Oct 18
Volvo potentially incurs its own Dieselgate
Volvo says that it has detected the premature degradation of one emissions control component. This leads to NOx emissions that exceed legal limits over time. The trucks involved were delivered overwhelmingly to clients in Europe and North America. According to the company’s release, it is impossible to assess the possible financial impact at this time, but the costs could be material.
16 Oct 18
Q2 has been formidable
Volvo’s Q2 revenue surpassed the SEK100bn level for the first time ever and EBIT of clearly more than SEK11bn was above the SEK10bn level for the first time as well. Strong demand combined with cost reductions in the past have translated into these superb numbers.
19 Jul 18
Geely’s acquisition of Daimler stake changes Volvo’s Supervisory Board
Volvo is clearly unsatisfied with Geely’s latest announcement. It had acquired a stake in Volvo just a few weeks ago and has now decided to buy a stake in Daimler, Volvo’s fierciest competitor for trucks around the world. It remains to be seen whether the nomination committee will allow a new Geely representative to join its Supervisory Board.
26 Feb 18
Q4 17 dollar weakness took its toll, but not on profits
Volvo released the expected superb 2017 numbers and management’s optimistic view for 2018 is also reflected in the dividend which is raised by SEK1 to SEK4.25 whereas we had expected SEK3.75. This higher dividend proposal was also supported by much improved cash generation.
31 Jan 18
Chinese Geely acquires the shares that were held by Cevian
Geely, which does not have any expertise in manufacturing trucks, has acquired a stake of a good 8% from Cevian. Speculations suggest that this might eventually lead to the re-merger of Volvo Trucks and Volvo Cars as Geely had acquired the latter operation from Ford earlier this decade.
29 Dec 17
9M 17 numbers ahead of our expectations
Volvo has delivered superb revenue and profit numbers. Consolidated revenue increased by a good 12% to SEK77bn in the last quarter which brought the 9M number to SEK243bn, an increase of almost 11%. The respective EBIT numbers were +60% to SEK7.42bn and +67% to SEK23.0bn. We had expected 9M numbers of SEK240bn (sales) and SEK20.6bn (EBIT).
20 Oct 17
New financial targets
Management has changed the financial targets for the Volvo Group from benchmark targets for the divisions to absolute targets for consolidated accounts. The previous goals were requiring the individual divisions (i.e. Trucks, Buses, Construction Equipment and Penta) to generate profit margins that were ranked amongst the top two of the respective industries. The new targets are a consolidated EBIT margin >10% over an entire business cycle. We find this target as being extremely ambitious and, in the past, Scania was the only truck producer that generated a margin of this magnitude. Caterpillar, the market leader for construction equipment, achieved double-digit EBIT margins in the years 2011 through to 2013, i.e. not during an entire business cycle. Our current projections see the EBITDA margin going up to slightly more than 13.5% in both 2017 and 2018 from 12.5% in 2016. However, Volvo’s H1 17 accounts show depreciation charges of 2.0% on tangible assets, 1.1% on intangible assets and another 2.1% on leased vehicles. As a result and based on these numbers and assuming the ratios will be similar for the full-year, the EBIT margin will be in the vicinity of 8.5% which is also the margin we have pencilled in into our P&L. Because of the sheer size of the Truck division, its profit development is of utmost importance for consolidated accounts. This division generated a peak margin of a good 8% in 2007 and 9% in 2011. The divisional margin, based on management’s definition, was just below 10% in both Q2 and H1 17. Our conclusion is that an EBIT margin of more than 10% is possible once demand for construction equipment and trucks, in particular for heavy trucks, is strong in all regions and at the same time. This, combined with further cost cuts, will allow Volvo to generate the proposed consolidated margin. However, the past has shown that both trucks and construction equipment are very cyclical operations indeed. Even if we assume that the group has restructured itself so that it can react in time when demand falls, we doubt that it can avoid a severe margin retreat, but it could possibly avoid a loss similar to the one it suffered in 2009. However, can it avoid a margin fall to just above 2% as in both 2013 and 2014?
01 Sep 17
Caterpillar raises full-year revenue and profit projections
As demand for construction machinery is finally rising just about everywhere with the exception of EMEA, management raises its full-year revenue projection from $38-41bn to $42-44bn. The new EPS guidance is $3.50 compared to $2.10. The sales and profit trends turned around in Q2 17. Revenue was up by almost 10% to $11.3bn and operating earnings increased by 59% to $1.25bn. The profit number clearly benefited from management’s strict cost control which is indicated by the fact that the workforce fell by 1,700 to 111,200 during the last twelve months. As Q1 17 was still quite poor, H1 revenue was up by only 6.8% to $21.2bn and EBIT by 30% to $1.67bn.
26 Jul 17
Good H1 numbers plus recovering order inflow
The group’s H1 numbers have exceeded our expectations. Consolidated revenue increased by 10% to SEK166bn and EBIT recovered by 70% to SEK15.6bn. In fact, this profit number is the highest ever generated by Volvo during the last decade. We had expected an operating profit number of a good SEK11bn and revenue of SEK161.5bn.
19 Jul 17
APAC demand continued recovering, but RoW is overwhelmingly weak
Caterpillar’s latest 3-month-moving-average retail sales numbers show a fall of 1% for February, but increases of 1% for both March and April. However, both the regional break-down and the sector demand numbers diverge quite significantly. Demand for construction equipment has clearly recovered from +2% in February to +7% in March and +8% in April. The trends have been positive in all regions, except for EMEA, where demand continued to fall. The same is true for North America, but the growth rates are less negative. On the other hand, the trend is positive in LatAm with +3% in April and even more so in APAC (+59%). Less encouraging is the demand situation from the mining industries. The rate of decline was 7% in February and it fell to 19% in both March and April. All regions have shown negative growth in April with LatAm continuing to collapse (-69%). In fact, the trends have been negative in APAC (+1% in February but -6% in April) and EMEA (+16% in February but -8% in April). Demand from the North American resources industries has remained weak (-12% in February and -13% in April) as of late.
19 May 17
Good Q1 profit numbers and strong asset control
Volvo’s revenue increased by 8% to SEK77.4bn, which allowed earnings to increase strongly. EBIT was up by 32% to SEK7.0bn and net profit by 26% to SEK4.73bn. In addition, cash from operations was a positive SEK8.6bn compared to a negative SEK6.0bn in Q1 16. As a result, the group’s net debt fell from SEK116bn at the end of Q1 and Q4 16 to SEK109bn. All these numbers are better than we had anticipated.
25 Apr 17
Orders from the Asian construction industry recover
Caterpillar’s latest numbers show a sharp 56% increase in orders from that regional segment of the industry. While orders continued falling in all other regions, worldwide orders for construction machinery were up by 7% in March. The respective February and January numbers were +2% and -8%. The picture continues to be very different for machinery from the resources industry. In fact, this trend is again deteriorating. While orders in APAC were up by 26% in January and by 1% in February, they fell by 1% in March and this trend was significantly worse in Nafta. As a result, worldwide orders were down by ‘only’ 7% in both January and February, but by 19% in March. As a result of the above, Caterpillar’s total orders (in volume terms) were down by 1% in both February and March, while they had fallen by 8% in January.
25 Apr 17
Mixed picture from J Deere for Q1 16/17
The group’s revenue increased by 2% to $5.63bn in the quarter through to 29 January while net earnings fell by 24% to $194m. Agricultural and turf revenue was unchanged at $3.6bn, whereas it fell in the construction and forestry division by 6% to $1.1bn. Positive consolidated growth exclusively stemmed from a rise in financial services (+9% to $696m) and ‘other’ (+93% to $231m). The group’s operating earnings were up by 2% to $416m, but this number excludes certain head office costs. Agricultural and turf achieved a 48% profit increase to $213m, while it fell in both construction and forestry (-51% to $34m) and financial services (-13% to $169m). Management blames continuously soft conditions in farming and construction for the profit setback, in particular in the USA and Canada.
18 Feb 17
Except for cash generation, most 2016 numbers were fine
Volvo’s revenue and profit growth numbers have recovered in Q4 16. This has resulted in a full-year sales decrease of ‘only’ 3.4% to SEK302bn (-5.8% in 9M 16) and an EBIT fall of 19% to SEK21bn (-27% in 9M). Both numbers are ahead of our projected SEK296bn and SEK17.4bn (excluding disposal gains of SEK2.26bn). As management is also quite optimistic for 2017, it proposes to increase the dividend from SEK3 to SEK3.25 (we had expected an unchanged dividend).
01 Feb 17
Dismal 2016 results from Caterpillar
The group’s revenue fell by 13% to $9.57bn in Q4 and by 18% to $38.5bn in the full-year. As total costs were hardly down in Q4, the operating loss amounted to $1.26bn (loss of $175m in Q4 15). However, the latest number included impairment charges of $595m vs. zero a year ago and also a considerable market-to-market loss related to pensions. Excluding the impairment charge, the operating loss was $667m. The full-year EBIT was +$498m compared to a profit of $3.8bn in 2015. The group’s net loss after minorities was $1.17bn in Q4 (loss of $94m in Q4 15) and $67m in the full-year (profit of $2.5bn in 2015).
26 Jan 17
Truck delivery fall accelerates in Q3, but prices stabilise
The group’s consolidated accounts showed a Q3 revenue fall of 6.2% to SEK68.8bn which brought the ytd number to SEK219bn, a fall of 5.8%. Simultaneously, the EBIT numbers were SEK4.66bn (unchanged) and SEK13.8bn (-27%), respectively. While the 9M profit number is slightly ahead of our expectation (€13.35bn), the sales number is marginally lower (SEK221.8bn).
21 Oct 16
$75m disposal gain limited John Deere’s Q3 and 9M profit setback
The revenue decline of both the Agricultural and Construction Equipment divisions accelerated in Q3. The former division saw its turnover falling by 11% to $4.70bn in the last quarter (through to July) and by 7% to just above $14bn in the 9M. The respective numbers for Construction Equipment were -24% to $1.16bn and -21% to $3.7bn. In spite of this, Agricultural Equipment achieved a 21% EBIT gain to $571m in the last quarter but the operating result was down by 4% to $1.33bn in the 9M. However, these numbers include the above disposal gain from the listing of SiteOne Landscapes, in which Deere continues to own a 24% stake. Agricultural Equipment saw its EBIT falling by 58% to $54m in Q3 and by 58% to $197m in 9M. Finally, Financial Services suffered an operating profit setback of 20% to $191m in Q3 and of 26% to $545m in 9M. Management blames the lack of volume and negative currency impacts for the revenue and profit falls of the two manufacturing divisions. In addition, it blames less-favourable financing spreads, a higher provision for credit losses, and higher losses on lease residual values for the profit decline of Financial Services.
19 Aug 16
Continuously deteriorating Caterpillar numbers
The company saw its revenue falling by 16% to $10.3bn in Q2 which brought the H1 number to $18.4bn, a fall of 22%. The respective EBIT numbers were $785m (-41%) and $1.28bn (-58%). As these numbers are no better than management had expected in April, it is now seeing the full-year numbers coming in at the bottom end of the indicated range.
26 Jul 16
Rather poor H1 16 numbers might require further restructurings
Volvo showed accelerating rates of decline for Q2 compared to Q1 16 while we had expected a moderation. Consolidated revenue fell by 5.6% to SEK151bn in H1 which is marginally below our projected SEK155bn. However, EBIT of SEK9.1bn (-35%) is clearly lower than our anticipated SEK10.7bn. The truck division showed a 5.0% delivery fall to 98,780 vehicles while divisional revenue fell by 7.7% to just above SEK100bn. Consequently, the ASP fell by 2.9% to SEK1,016k. Finally, cash from operations (based on management’s definition) collapsed by 69% to SEK2.9bn which is the result of a very poor Q1.
19 Jul 16
Volvo adds another SEK2.3bn to provisions for having fixed prices
In the context of the EU investigation into price fixings of truck producers, the company had created a provision of SEK3.8bn in Q4 15 and it now adds another SEK2.3bn. Management seems to be worried that the previous provision is insufficient. The EU’s investigation is still ongoing and Volvo says that it is ‘fully’ cooperating. Hence, we are surprised that the number keeps going up.
30 Jun 16
Deere’s revenue and profits continuously under pressure
The group released Q2 15/16 numbers (FYE 31 October) and these show a continuing downward trend, in particular for its Construction & Forestry division and for Financial Services. While revenue of the Agricultural & Turf division was almost unchanged in Q2 (-0.4% to $5.74bn), revenue of Construction & Forestry fell by 16% to $1.37bn. Turnover of Financial Services was also almost unchanged (-2% to $117m). All of these variations were less strong in Q2 compared to Q1. However, divisional operating earnings deteriorated faster in Q2 in both Construction & Forestry (-61% to $74m) and Financial Services (-40% to $160m), whereas the profit slump was small at -4% to $614m in Agricultural & Turf. Management blames higher losses on lease residual values for the profit collapse of Financial Services, whereas the profit fall in Construction & Forestry is simply the result of falling volumes.
20 May 16
US truck market continues to collapse
Volvo released dismal Q1 16 numbers. The group’s revenue fell by 4% to SEK71.7bn, EBIT was down by 22% to SEK5.3bn and cash from operations (based on the management’s definition) moved from +SEK1.9bn to -SEK6bn. Net profit was down by 11% to SEK3.8bn, but this moderate fall is the result of a SEK885m disposal gain stemming from the sale of the group’s IT operation. We found no full-year 2016 guidance in Volvo’s quarterly report.
22 Apr 16
2015 numbers fell slightly short of our projections
Almost all of the group’s revenue and profit numbers fell slightly short of what we had expected. Consolidated revenue was up by a good 10% to SEK312.5bn (our forecast was SEK316.3bn). At a glance, EBIT more than doubled to SEK25.7bn (we had SEK18.1bn), but management’s number included disposal gains of more than SEK4.6bn and other operating expenses fell by SEK3.5bn. The 2014 number was burdened with SEK3.8bn provisions for the EU antitrust case. In addition, Volvo gained SEK0.8bn in an arbitration tribunal that contributed positively to Q4 15 EBIT. The group’s pre-tax (SEK20.4bn vs. expected SEK20.7bn) and net earnings (SEK15.1bn vs. SEK15.7bn) show that earnings have not improved.
05 Feb 16
Caterpillar experienced accelerating sales and profit falls in Q4 15
The world’s largest producer of earth-moving equipment suffered a 23% revenue drop to $11.0bn and a 45% EPS fall (when restructuring charges are excluded) to $0.74 in the last quarter. The full-year numbers were clearly less negative (-15% to $47bn and -27% to $4.64, respectively). In fact, EPS including restructuring charges were negative at $0.15 in Q4 and were down by 40% to +$3.50 in the full-year. Caterpillar suffered from its reporting currency, i.e. the strong US$ reduced revenue generated in many other regions however volumes were also sharply down. In fact, Q4 revenue was down by 26% in North America where the currency movement had no material impact. Revenue fell by 36% in LatAm because of the Brazilian turmoil whereas the fall of 20% in EMEA and of 16% in APAC was primarily due to currency movements. Volvo reports its numbers in less strong SEK and the Construction Equipment division’s regional revenue break-down is different from Caterpillar’s. Volvo generated around 20% of its 2014 revenue in a particularly weak North America whereas Caterpillar’s share was 44% in Q4 15. On the other hand, Volvo realised much larger shares in EMEA (33% vs. 26% for the US peer) and in APAC (35% vs. 20%). As a result of the different reporting currency and a different regional revenue mix, Volvo’s Construction Equipment showed a 9M15 revenue fall of only 1%. As Q4 has been considerably weaker than 9M15, our full-year projection of a divisional revenue fall of some 2% might be too optimistic. However, we do not see revenue having come down as sharply as Caterpillar’s. Nevertheless, we are unlikely to maintain our expected sales increase for 2016 once Volvo has published its 2015 accounts on 5 February.
28 Jan 16
Truck deliveries +2.2% in October and +2.8% ytd
The absolute numbers were 20,193 in the last month and 171,470 ytd. As in the months before, Europe continues to show a recovery (+15% to 8,688 and +17% to 69,219, respectively) whereas growth in the North American market is flattening (+6% to 6,246 and +16% to 55,364). On the other hand, Latin America (-31% to 1,293 and -52% to 9,254) remains in the doldrums. Deliveries in Asia (-3% to 2,818 in October) remain relatively weak and Others (i.e. Africa, Australia, and possibly the Middle East where deliveries fell by 26% to 1,148) is getting weaker month after month (-17% to 11,594 ytd). The Volvo (-1% to 11,368 deliveries in October) and UD brands (-18% to 1,598) suffered falling delivery numbers. This is particularly negative for UD’s capacity utilisation as almost all of its vehicles are produced in Japan. Volvo’s capacity utilisation is sharply falling in Latin America whereas demand is reasonable in Europe. On the other hand, utilisation is clearly improving for the Renault brand (+16% to 4,533) and also for Mack (+10% to 2,673). These latter two have their plants in Europe and North America.
19 Nov 15
Chinese excavator demand in doldrums
Caterpillar does not see Chinese demand for these construction machines recovering to the level seen at the beginning of the current decade. The annual peak was seen in 2010 when 112,000 excavators in the 10-90 tons range were sold. In fact, a monthly peak was reached in March 2011 when 27,000 units were sold. The company expects the market to be down to 23,000 units for the full-year 2015. This company does not see the Chinese market recovering in the immediate future but sees a glimmer on the immediate horizon. That is China’s introduction of more stringent emission requirements for off-road engines, and Caterpillar argues that it is the first company to have received Chinese certification from the environment ministry for larger engines.
17 Nov 15
SEK800m one-off gain has been realised
An Arbitration Tribunal has granted Volvo a compensation payment of some SEK800m from a supplier. Many years ago, this supplier delivered defective components and Volvo had asked for compensation which was rejected. The Tribunal has now decided that Volvo was right and this decision seems to be final. It raises our current 2015 pre-tax profit forecast by some 4%.
10 Nov 15
Stronger than expected Q3 15 profit growth
Volvo’s consolidated numbers show a moderation in revenue growth (from +15% to SEK160bn in H1 to +9% to SEK73bn in Q3) and also of EBIT growth (from +143% to SEK14.2bn to +107% to SEK4.65bn). While the sales number is about in line with our projection, 9M 15 EBIT of SEK18.8bn is about SEK1.6bn higher than we had anticipated. This latter number includes the SEK4.6bn Eicher disposal gain generated in H1 15 which we do not regard as operating profit.
26 Oct 15
Caterpillar lays off and closes plants
As demand for construction equipment keeps falling, Caterpillar has decided to reduce its workforce by 10,000 (out of a good 100,000) and to close some of its factories through to 2018. Initially, this will cost some $2bn but annual costs are expected to be down by around $1.5bn starting in 2019. One reason for the company’s problems is the strength of the US dollar. This should have helped Volvo which produces in regions with weaker currencies. However, the most recent numbers it has shown for Construction Equipment are also not much better.
25 Sep 15
Demand for construction equipment keeps falling
Caterpillar’s sales numbers for the month of August show a drop of 11% which is in-line with the sales fall in July but marginally better than the -14% experienced in June. Demand from the resources industries in APAC is particularly weak (-46% in August) as is Latin American demand from the construction industry (-49%). Some stabilisation has become visible as of late. Sales to the resources industries in EMEA and in Latin America have increased during the last few months, but these two regions are not large enough to compensate for the further fall in other regions.
22 Sep 15
Truck shipments +2.6% in August
Worldwide shipments reached 12,116 in the last month which brought the ytd number to 131,641, an increase of 2.6% as well. These numbers exclude shipments of Chinese joint-ventures which are not fully consolidated. The growth rates continue to be strong in Europe (+28% to 3,904) and in North America (+13% to 4,416) while LatAm continues to show collapsing sales numbers (-43% to 872). Finally, the rates of decline are accelerating in both Asia (-8% to 1,863) and Other Markets (-20% to 1,061). Volvo’s individual brands are showing a mixed performance. Volvo Trucks (the most important brand) has suffered a delivery fall of 6% to 6,528 in August, although it sells some 40% of its trucks in recovering Europe. The brand has only gained momentum in North America (c. 35% of divisional deliveries) but suffered sharp falls in all other regions. Thanks to its dependence on Europe, Renault Trucks increased deliveries by 60% to 2,366. UD saw its deliveries falling by 15% to 1,368 as more than 70% of its trucks go into Asia. Finally, Mack is a disappointment. It sells more than 90% of its vehicles in the booming North American market, yet deliveries were up by only 2.5% to 1,837.
17 Sep 15
Revenue and profit warning from Deutz
The manufacturer of engines for agricultural and construction machinery now expects sales to fall by 20% (instead of 10%) in 2015. The company’s new EBIT guidance is for break-even rather than a positive margin of 3%. Consequently, we cannot exclude that both Volvo and CNHI will release profit warnings for the current year as well. It remains to be seen whether conditions will improve in 2016. We are currently projecting profit recoveries for both companies next year. Although this might be possible, the rate of improvement is likely to be too optimistic, in particular for Volvo.
16 Sep 15
North American truck boom ending?
Volvo increased worldwide truck deliveries by 1.1% to 15,586 in July which has brought the ytd number to 119,525 (+2.6%). Whereas deliveries of heavy-duty trucks continued growing at reasonable speed (+2.6% to 13,205 and +2.2% to 101,552, respectively), light-duty truck deliveries fell sharply (-14% to 1,301 and +10% to 9,308). The latter trucks are produced by both Renault and UD and these sell their vehicles overwhelmingly in Europe and Asia. With the exception of Asia (+27% to 2,537 in July but -1% to 18,585 ytd), where growth accelerated, regional growth either moderated considerably (e.g. in North America +1% to 4,852 in July but +18% ytd, in Europe +5% to 5,884 but +17% to 48,007) or it remained in the doldrums (e.g. LatAm - 34% to 1,039 and -58% to 5,940 and Others -12% to 1,274 and -15% to 8,352).
20 Aug 15
Eicher disposal gain and currency effect boost H1 15 earnings
At a glance, Volvo’s H1 numbers are excellent and clearly better than we had expected. Revenue increased by 15% to SEK160bn and EBIT after restructuring charges was up by 143% to SEK14.2bn. These numbers allowed the group to increase net earnings after minorities from SEK3.7bn in H1 14 to SEK9.4bn. However, stated operating earnings include a disposal gain of SEK4.6bn from the sale of Eicher Motors and the currency impact amounted to almost SEK3.1bn. Excluding both, EBIT was up by 11% to SEK6.5bn.
17 Jul 15