Solid operating profit for Volkswagen Group

Worldwide
Published:  28 October, 2016

Volkswagen Group has reported an operating profit before special items of €11.3 billion in the first nine months of 2016, representing a 10.5% increase against the same period in 2015.

Total sales revenue for the Group was €159.9 billion, on level with the previous year, and a 7% increase was reported on the operating return on sales before special items. According the automotive manufacturer, earnings in the third quarter were impacted by “further provisions recognised in connection with the diesel issue of €0.4 billion.”

Between January and September 2016, operating profit after special items amounted to €8.6 billion, while profit after tax was €5.9 billion. 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 2016 is said to have remained stable at €3.6 billion.

The Volkswagen Passenger Cars brand's unit recorded sales of 3.2 million vehicles in the first nine months of 2016, less than the prior-year level. Operating profit before special items decreased to €1.2 billion attributed to volume, mix and exchange rate effects as well as higher marketing costs as a consequence of the emissions scandal.

Audi increased its unit sales by 0.7% year-on-year in the reporting period, to 1.2 million vehicles worldwide. The Chinese joint venture FAW-Volkswagen sold a further 411,000 Audi vehicles. Operating profit before special items is reported to have reached the 2015 level at €3.9 billion.  According to the Group, “in addition to exchange rate effects and intense competition, the expansion of the model and technology portfolio and the international production network had a negative impact on earnings.”

Thanks to the popularity of the new Bentayga, the Bentley brand increased its unit sales by 6.1% year-on-year between January and September 2016. Operating profit is reported to be on a level with the previous year at €54 million in spite of changed market conditions.

Sales of the Porsche brand rose 5% year-on-year to 177,000 units worldwide. Operating profit increased 12.2% to €2.9 billion thanks to volume, mix and exchange rate effects.

The Group expects deliveries in 2016 will to be slightly higher than in 2015 amid persistently challenging market conditions, with a growing volume in China. Sales revenue in 2016 is expected to match the prior-year level, depending on the economic conditions, exchange rate developments and the diesel emissions issue.

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