Volkswagen AG: First Quarter Earnings Report
WOLFSBURG, Germany--May 7, 2003--January-March 2003 2002 +/- (%) ---------------------------------------------------------------------- Volkswagen Group Deliveries to customers '000 units 1,195 1,179 + 1.4 Unit sales '000 units 1,218 1,181 + 3.1 Production '000 units 1,280 1,217 + 5.2 Sales revenue million EUR 20,698 21,266 - 2.7 Operating profit million EUR 604 1,130 - 46.5 Profit before tax million EUR 331 997 - 66.8 Profit after tax million EUR 202 627 - 67.8 Earnings per ordinary share - undiluted EUR 0.51 1.62 - 68.5 Automotive Division Cash flows from investing activities million EUR 2,028 1,851 + 9.6 Cash flows from operating activities million EUR 1,533 2,452 - 37.5 ----------------------------------------------------------------------
As forecast at the annual press conference in March 2003, earnings in first quarter 2003 have come under substantial pressure in comparison to first quarter 2002. Major factors impacting on operating profit were the model ramp-ups, involving higher start-up costs and upfront expenditures, as well as negative effects from exchange rate movements. Consequently, it is not possible simply to extrapolate the first quarter result for the year as a whole. We expect operating profit to improve substantially in the course of the year, on the basis of increasing unit sales of our expanded and updated product range - in particular the models Touareg, Touran, Audi A3, Golf and the new generation Transporter. This development will be reinforced by the continuing programs aimed at optimizing product costs and by the measures to reduce capital investments. Our product-related programs will be continued, however. Against this background, we expect to see a significant improvement in operating profit, especially in the third and fourth quarters. Overall, we confirm our forecast for the full year 2003 as stated at the Annual Press Conference.
Wolfsburg, May 7, 2003 - VOLKSWAGEN AG - The Board of Management
(The full interim report is available at http://www.volkswagen-ir.de )