Scania has announced financial results for the first half of 2001 which show a sharp increase in net income to SEK 1,459 million against 838 million in the same period of last year.
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A large part of the improvement reflected the divestment of the importer operations of Svenska Volkswagen AB and the dealership chain Din Bil AB to Volkswagen. The combined purchase price amounted to more than SEK 1.3 billion, and the capital gain was SEK 550 m. In terms of liquidity, the divestments represent a positive effect of more than SEK 1.5 billion.
Scania also reported better than expected demand in Europe.
“In Europe, demand has proved somewhat better than we had expected, but substantial uncertainty persists. In Latin America there are few bright spots. The outcome of the presidential election in Brazil as well as economic and political developments in Argentina will be crucial to the business development in the region. All this leads to high uncertainty regarding the market development. Scania’s action programmes in the form of a stricter price policy and streamlining of the production network, together with good growth in service-related business, are targeted to achieve further improvements,” said Leif Ostling, Scania’s President and CEO.
The operating margin for Scania products amounted to 7.5 percent during the first half of 2002 and 8.4 percent during the second quarter.
Scania said that the demand picture in Europe is divided. The downturn in Great Britain, Italy and Spain is limited, while the decline is significantly larger in Germany, France and the Benelux countries. Scania’s said its western European market share during the first five months of 2002 was 14.3 percent and warned of ‘considerable uncertainty about future developments’. Demand for heavy trucks in western Europe has currently stabilised at an annual rate of around 190,000 units.
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By GlobalDataScania said that the markets in central and eastern Europe are performing relatively well, with the exception of Poland. The company says that Russia in particular shows substantially higher order bookings than last year.
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