Skoda Auto Finishes 1st Quarter in the Black

MLADA BOLESLAV, CZECH REPUBLIC – April 30, 2009: Despite the ongoing worldwide economic crisis, the Czech Republic’s largest carmaker Škoda Auto was able to finish the first quarter in the black with an operating profit of approximately €28 million.

In the period from January to March 2009, Škoda delivered a total of 143,079 cars to customers. Compared with the same period in the previous year, this represents a drop of 17.5%. The worldwide auto market experienced a greater decline however, falling 20.7% in the same period.

New car orders at Škoda Auto are developing very positively; in Europe, 27% more orders were received in January through March than during the same period last year. In this regards, the markets in Germany, Austria, the Czech Republic, Slovakia and Poland are particularly notable. Incoming orders on the Chinese market also experienced year-on-year growth of around 14%.

Customers are expressing particularly high interest in the Škoda Fabia and Škoda Roomster, as well as in cars equipped with a fuel-efficient 1.2 litre engine. The environmental and scrapping premiums adopted in a number of European countries to aid the automotive industry have had a positive impact on Škoda.

The presentation of the new Škoda Yeti at this year’s Geneva Motor Show was another highlight. The launch of the fifth series and the first deliveries to customers are planned for late Q3 or early Q4 2009. The Škoda Yeti has a low environmental impact and is a compact, fuel efficient alternative to classic SUVs.

“The first quarter of 2009 was very hard – the impacts of the worldwide economic crisis are also leaving their mark on Škoda. But with our modern and environmentally-friendly products, we have succeeded in expanding our market share in important markets such as Germany and China. New car orders are also moving in a very positive direction at Škoda. Furthermore, we have introduced numerous measures to secure Škoda’s economic situation over the long term and to come out of the current crises stronger than before,” Škoda Auto’s Chairman of the Board, Reinhard Jung commented on the situation.

Overall, the Škoda Auto group was able to contribute an operating profit of €28.2 million to the Volkswagen Group’s first-quarter aggregate earnings. On the local balance sheet, the group’s operating profits reached CZK 787.4 million. Cash flow from current transactions was able to rise to CZK 6.5 billion (+30.1%).

“We know that 2009 will be particularly hard for us as well as for the entire automotive industry. The results we achieved for the quarter did go somewhat beyond our forecasts, particularly due to the scrapping premium offered in certain countries. The prospects are still unclear however, and filled with substantial risks. Yet I am convinced that through our Scout profit improvement programme, we will succeed in sustaining our financial strength and stability and even in this period of crisis, achieve a reasonable profit,” Holger Kintscher, the Board of Directors Member responsible for finance, summarised in a statement regarding the current situation.