Volkswagen Group Third Quarter Financials--Sharp Rise in Sales Revenues
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- Sharp year-on-year rise in sales revenue to EUR 160.3 billion (EUR 147.7 billion)
- Negative special items relating to diesel issue of EUR 6.7 billion and in trucks business of EUR 0.2 billion
- Operating profit after special items at EUR 3.3 billion (EUR 9.4 billion)
- Full-year earnings forecast adjusted
- Equity-accounted profit of the Chinese joint ventures stable
- Additional liquidity in excess of EUR 3 billion from sale of Suzuki shares
- Net liquidity in Automotive Division increases to EUR 27.8 billion
- CEO Müller: "We will do everything in our power to win back the trust we have lost"
WOLFSBURG -- October 28, 2015:
The Volkswagen Group generated an operating profit before special items of
EUR 10.2 billion (EUR 9.4 billion) in the first nine months of the year.
Sales revenue grew by 8.5 percent to EUR 160.3 billion. The operating
return on sales before special items amounted to 6.4 percent. Earnings were
impacted by charges of EUR 6.7 billion in the third quarter for forthcoming
measures relating to the diesel issue. As a result, operating profit after
special items amounted to EUR 3.3 billion (EUR 9.4 billion). Profit after
tax was EUR 4.0 billion (EUR 8.7 billion). As already announced, the
full-year earnings forecast was adjusted accordingly.
"The figures show the core strength of the Volkswagen Group on the one
hand, while on the other the initial impact of the current situation is
becoming clear. We will do everything in our power to win back the trust we
have lost", said Matthias Müller, Chairman of the Board of
Management of Volkswagen Aktiengesellschaft, in Wolfsburg on Wednesday.
The Group's operating profit and sales revenue exclude the
activities of the Chinese joint ventures, which are accounted for in the
financial result using the equity method. The share of operating profit
attributable to the Chinese joint ventures to the end of September remained
level at EUR 3.8 billion (EUR 3.9 billion).
"The
Volkswagen Group has very solid and robust liquidity resources. This will
help us manage the challenging situation caused by the financial impact of
the diesel issue", said Chief Financial Officer Frank Witter.
Net liquidity rises in the Automotive Division
The Automotive Division's net cash flow increased
considerably year-on-year to EUR 11.8 billion (EUR 5.5 billion) thanks to
the Group's robust business model. Net liquidity in the Automotive
Division amounted to EUR 27.8 billion at the end of September (end of
December 2014: EUR 17.6 billion). The Automotive Division's investments
in property, plant and equipment, investment property and intangible
assets, excluding capitalized development costs (capex) increased to EUR
7.3 billion (EUR 6.5 billion). The ratio of capex to sales revenue in the
Automotive Division amounted to 5.3 percent (5.0 percent).
Brands and Business Fields
The Volkswagen
brand's operating profit before special items relating to the diesel
issue rose to EUR 2.2 billion (EUR 1.7 billion). Positive effects from
exchange rates, optimized sales revenue and costs, and the efficiency
program more than offset the negative effects of the markets in South
America and Russia.
Audi lifted operating profit to EUR 4.0
billion (EUR 3.8 billion) due to sales growth, positive changes in the mix
and favorable exchange rate movements. Earnings were negatively impacted by
high upfront investments in new products and technologies, as well as the
expansion of the international production network.
Operating
profit at ŠKODA increased to EUR 734 million (EUR 651 million),
mainly due to mix effects, optimized material costs and more favorable
exchange rates.
The SEAT brand's operating profit rose to
EUR 12 million (previous year: operating loss of EUR 82 million). This was
mainly due to higher volumes, positive exchange rate effects and optimized
costs.
Bentley generated an operating profit of EUR 57 million
(EUR 125 million) due to lower vehicle sales and higher upfront
expenditures. Exchange rate effects and lower costs were unable to offset
this trend.
Operating profit at Porsche improved to EUR 2.5
billion (EUR 1.9 billion) due to volume and exchange rate effects.
Porsche's growth is uniform in the key global markets. Changes to the
mix, increased structural costs and higher development costs had a negative
impact on earnings.
Volkswagen Commercial Vehicles continued
to renew its product range and posted an operating profit of EUR 313
million (EUR 378 million).
Scania generated an operating
profit of EUR 748 million (EUR 700 million); this increase was primarily
due to the service business and positive exchange rate effects. MAN's
operating profit before restructuring expenses amounted to EUR 271 million
(EUR 304 million). The negative trends in the commercial vehicles market in
South America weighed on earnings. Restructuring measures resulted in
special items of EUR –170 million.
Operating profit at
Volkswagen Financial Services amounted to EUR 1.4 billion (EUR 1.2 billion)
on the back of positive volume and exchange rate effects.
Earnings forecast adjusted
The Volkswagen
Group expects deliveries to customers in 2015 to remain on a level with the
previous year in a persistently challenging market environment.
Depending on economic conditions, 2015 sales revenue for the Volkswagen
Group and its business areas is expected to increase by up to four percent
above the prior-year figure. However, economic trends in Latin America and
Eastern Europe will need to be continuously monitored in the Commercial
Vehicles/Power Engineering Business Area.
Because of charges
related to the irregularities in the software used for certain diesel
engines, we expect 2015 operating profit for both the Group and the
Passenger Cars Business Area to be down significantly year-on-year. We
expect an operating return on sales before special items of between 5.5 and
6.5 percent for the Group's operating profit; this will amount to
between 6.0 and 7.0 percent in the Passenger Cars Business Area.
| 2015 | 2014 | % | 2015 | 2014 | % |
| Q3 | Q3 |
| 9M | 9M |
|
Volume data |
|
|
|
|
|
|
Deliveries to customers |
|
|
|
|
|
|
(‘000 units) | 2,392 | 2,476 | –3.4 | 7,431 | 7,542 | –1.5 |
Vehicle sales ('000 units) | 2,350 | 2,439 | –3.7 |
7,440 | 7,646 | –2.7 |
Production ('000 units) |
2,125 | 2,404 | –11.6 |
7,438 | 7,638 | –2.6 |
Employees |
|
|
|
|
|
|
('000 at Sep. 30/Dec. 31) |
|
|
| 613.9 | 592.6 | +3.6 |
|
|
|
|
|
|
|
Financial data |
|
|
|
|
|
|
(IFRSs), EUR million |
|
|
|
|
|
|
Sales revenue | 51,487 | 48,910 | +5.3 | 160,263 | 147,718 | +8.5 |
Operating profit before |
|
|
|
|
|
|
special items | 3,206 | 3,230 | –0.7 | 10,197 | 9,416 | +8.3 |
Special items | –6,685 | – | X | –6,855 | – | X |
Operating profit/loss | –3,479 |
3,230 | X | 3,342 | 9,416 | –64.5 |
as a percentage of revenue |
–6.8 |
6.6 |
| 2.1 | 6.4 |
|
Profit/loss before tax |
–2,522 | 3,713 | X | 5,142 | 11,490 | –55.2 |
as a percentage of revenue |
–4.9 |
7.6 |
| 3.2 | 7.8 |
|
Profit/loss after tax | –1,673 | 2,971 | X | 3,990 | 8,687 | –54.1 |
|
|
|
|
|
|
|
Automotive Division |
|
|
|
|
|
|
Cash flows |
|
|
|
|
|
|
from operating activities |
7,420 | 6,556 | +13.2 | 18,973 | 14,942 | +27.0 |
Cash flows from |
|
|
|
|
|
|
investing activities |
|
|
|
|
|
|
attributable to |
|
|
|
|
|
|
operating activities*) | 459 | 3,929 | –88.3 |
7,220 | 9,398 | –23.2 |
of which: capex |
2,688 | 2,904 | –7.4 |
7,340 | 6,482 | +13.2 |
as a percentage |
|
|
|
|
|
|
of sales revenue | 6.1 | 6.8 |
| 5.3 | 5.0 |
|
Net cash flow | 6,962 | 2,627 | X | 11,753 | 5,544 | X |
Net liquidity |
|
|
|
|
|
|
at Sep. 30 |
|
|
| 27,755 | 16,785 | +65.4 |
Net liquidity |
|
|
|
|
|
|
at Sep. 30/Dec. 31 |
|
|
| 27,755 | 17,639 | +57.4 |
*) Excluding acquisition and disposal
of equity investments: Q3: EUR 3,573 million (EUR 3,845 million),
January to September: EUR 10,246 million (EUR 9,694 million).
Figures by brand | Sales | Operating |
| Operating | ||
| revenue |
| profit |
| margin |
|
| in € m |
| in € m |
| in % |
|
|
|
|
|
|
|
|
| 2015 | 2014 | 2015 | 2014 | 2015 | 2014 |
|
|
|
|
|
|
|
Volkswagen Passenger Cars |
79,972 | 73,390 | 2,229 | 1,696 | 2.8 | 2.3 |
Audi |
43,695 | 39,300 | 4,024 | 3,831 | 9.2 | 9.7 |
ŠKODA | 9,280 | 8,784 | 734 | 651 | 7.9 | 7.4 |
SEAT |
6,388 | 5,622 | 12 | –82 | 0.2 | –1.5 |
Bentley | 1,364 | 1,259 | 57 | 125 | 4.2 | 9.9 |
Porsche *) | 16,471 | 12,241 | 2,546 | 1,927 | 15.5 | 15.7 |
Volkswagen Commercial Vehicles | 7,537 | 6,976 | 313 | 378 | 4.2 | 5.4 |
Scania *) | 7,686 | 7,511 | 748 | 700 | 9.7 | 9.3 |
MAN | 9,981 | 10,214 | 271 | 304 | 2.7 | 3.0 |
Volkswagen |
|
|
|
|
|
|
Financial Services | 19,403 | 16,058 | 1,381 | 1,215 | 7.1 | 7.6 |
*) Including financial services.