kscarbel2 Posted February 5, 2017 Share Posted February 5, 2017 Volvo Group Press Release / February 1, 2017 THE FOURTH QUARTER 2016 In Q4 2016 net sales increased by 4% to SEK 82.6 bn (79.6). Adjusted for currency movements and acquired and divested units sales decreased by 1%. Adjusted operating income in Q4 2016 amounted to SEK 5,660 M (4,573), corresponding to an operating margin of 6.9% (5.7), excluding a capital gain on the sale of real estate of SEK 1,371 M. Currency movements had a positive impact on operating income of SEK 336 M. Operating cash flow in the Industrial Operations amounted to SEK 4.8 bn (14.7). Adjusted for the EU antitrust investigation and the sale of real estate, operating cash flow was SEK 8.7 bn. THE FULL YEAR 2016 For the full year 2016 net sales decreased by 3% to SEK 301.9 bn (312.5). Adjusted operating income amounted to SEK 21,094 M (20,235) corresponding to an operating margin of 7.0% (6.5). Operating cash flow in the Industrial Operations amounted to SEK 3.5 bn (18.3). The Board of Directors proposes a dividend of SEK 3.25 per share (3.00). CEO’S COMMENTS Improved underlying performance on lower volumes 2016 was a year with somewhat lower volumes. Our revenues declined by 3% to SEK 302 bn. Nonetheless, our profitability improved with an adjusted operating margin of 7.0% for the full year 2016. This reflects our ability to manage volume changes in different regions as well as continued cost reductions and productivity improvements. The fourth quarter followed the pattern of previous quarters with somewhat improved profitability on lower volumes. Adjusted operating income was SEK 5,660 M, corresponding to a margin of 6.9% (5.7). In Europe, truck demand continues to be high due to good freight volumes combined with low fuel prices and interest rates that support our customers’ profitability. Volvo Trucks improved its market share to a historically high level of 16.9%, while Renault Trucks came in slightly lower than the previous year on 8.1%. The downward correction in the North American highway segment continued, but with some signs of stabilization as the industry’s inventory of new trucks came down to more healthy levels. However, there is still an overhang of used trucks in the market that will continue to dampen demand. The Japanese market is continuing to move side-ways at high levels, while there is still no sign of a recovery in the Brazilian truck market. In total, we delivered 50,489 trucks in the fourth quarter, which is 10% less than the preceding year. However, sales in our service business picked up and grew by 2% in local currencies. Profitability in Trucks improved and the adjusted operating margin was 8.7% (7.9). Global demand for construction equipment was roughly flat in 2016. However, there are now some signs of improving demand in Asia. Volvo CE continues to gain market share in its stronghold segments – excavators, wheel loaders and articulated haulers – and the fourth quarter turned positive with 19% higher machine deliveries year on year. The adjusted operating income improved to SEK 494 M corresponding to a margin of 3.8% (-1.7). The on-going work to strengthen Volvo CE’s competitive-ness is yielding result. During the quarter further steps were taken. A new and more efficient R&D organization will be implemented and we have also decided that Volvo CE will fit the Group’s in-house 8 liter engine into mid-sized excavators and wheel loaders replacing externally sourced engines. Furthermore, Volvo CE’s headquarters will be moved to Gothenburg to facilitate closer cooperation with the Group’s other business areas and operations. Buses profitability was slightly lower than in the previous year as a result of lower volumes. The adjusted operating margin was 3.3% (4.0) in the quarter. Volvo Penta had yet another strong quarter with sales growth within marine diesel and off-road engines. Operating income amounted to SEK 156 M corresponding to a margin of 6.5% (6.3). Financial Services improved earnings while increasing the share of the Group’s products financed. Operating income in the quarter was SEK 567 M and return on equity for the full year 2016 was 13.7% (13.4). 2016 was my first full year with the Volvo Group. We finalized the restructuring program and the goal to have a SEK 10 billion lower structural cost level in 2016 compared with 2012 was achieved. During the year we also took two important steps to optimize our business portfolio with the divestment of our external IT business and start-up of the process to divest Governmental Sales. We have also made a review of Volvo CE’s performance. After a couple of years with extraordinary growth, the construction equipment market witnessed a sharp decline in global demand, especially in China. This led to declining sales and unsatisfactory profitability affecting the entire industry, including Volvo CE. Our response to these market conditions has been to introduce a comprehensive performance improvement plan to drive efficiency across the company. The performance plan has led to profitability improvements despite continued challenging market conditions. During the implementation of the plan additional potential has been identified. Volvo CE is expected to deliver industry leading results and over time positively contribute to the Group’s operating margin. In order for the Board of Directors of AB Volvo to be more efficient in following up and supporting the positive development of Volvo CE, while at the same time keeping full focus on the development of the Group’s truck operation, the Board has decided to establish a Volvo CE Committee. To create further simplicity, transparency and flexibility, the intention is to increase Volvo CE’s structural independence within the Volvo Group. In 2017 we will focus on leveraging the new brand-based organization in trucks that is now fully operational. We will also continue the process of decentralization and empowerment to be able to even better serve our customers. I would like to extend a thank you to all my colleagues in the Group for all the good efforts made during the year. Martin Lundstedt President and CEO For a PDF version of the report, please click here: http://www.volvogroup.com/en-en/events/2017/feb/report-on-fourth-quarter-2016.html#Select any one Anchor Name from below list Quote Link to comment Share on other sites More sharing options...
kscarbel2 Posted February 5, 2017 Author Share Posted February 5, 2017 The Numbers In Q4 2016, sales (deliveries) from Volvo Group’s truck operations amounted to 50,489* units, down 10 percent from 56,198 units in Q4 2015. Volvo brand Q4 2016 truck sales (overall) fell to 27,934 units globally, down 8 percent from 30,201 units in Q4 2015. Volvo brand Q4 2016 truck sales in North America plunged to 4,458 units, down 49 percent from 8,756 units in Q4 2015. This follows another 49 percent sales decline in Q3 2016 versus Q3 2015. Volvo brand Q4 2016 truck sales in Europe rose to 16,146 units, up 20 percent from 13,408 units in Q4 2015. Volvo brand Q4 2016 truck sales in Africa/Oceania (includes Australia, New Zealand) rose to 1,189 units, up 3 percent from 1,155 units in Q4 2015. Mack brand Q4 2016 truck sales (overall) plunged to 4,119 units globally, down 42 percent from 7,057 units in Q4 2015. Mack brand Q4 2016 truck sales in North America plunged to 3,551 units, down 46 percent from 6,553 units in Q4 2015. Mack brand Q4 2016 truck sales in South America rose to 257 units, up 14 percent from 226 units in Q4 2015. Mack brand Q4 2016 truck sales in Africa/Oceania (includes Australia, New Zealand) rose to 311 units, up 12 percent from 278 units in Q4 2015. Renault Truck Q4 2016 brand sales (overall) fell to 13,191 units globally, down 5 percent from 13,829 units in Q4 2015. Renault Truck Q4 2016 brand sales in Europe fell to 11,602 units, down 7 percent from 12,508 units in Q4 2015. UD (Nissan Diesel) Q4 2016 brand sales (overall) rose to 5,245 units, up 3 percent from 5,111 units in Q4 2015. UD (Nissan Diesel) Q4 2016 brand sales in Asia rose to 4,528 units, up 8 percent from 4,201 units in Q4 2015. Total Global Deliveries by Brand Q4 2016 Q4 2015 % Change Volvo 27,934 30,201 -8 Renault Trucks 13,191 13,829 -5 UD (Nissan Diesel) 5,245 5,111 3 Mack 4,119 7,057 -42 Total Deliveries 50,489 56,198 -10 Total Global Deliveries by Truck Size Q4 2016 Q4 2015 % Change Heavy Duty (>16 metric tons) 42,223 47,411 -11 Medium Duty (7-16 metric tons) 4,131 3,960 4 Light Duty (<7 metric tons) 4,135 4,827 -14 Total Deliveries 50,489 56,198 -10 Total Global Deliveries by Region Q4 2016 Q4 2015 % Change Europe 27,748 25,917 7 North America 8,105 15,389 -47 South America 2,590 3,108 -17 Asia 8,762 8,758 0 Africa & Oceania* 3,284 3,026 9 Total Deliveries 50,489 56,198 -10 * includes Australia, New Zealand For full year 2016, sales (deliveries) from Volvo Group’s truck operations amounted to 190,424* units, down 8 percent from 207,475 units in 2015. Volvo brand full year 2016 truck sales (overall) fell to 102,857 units globally, down 9 percent from 113,066 units in 2015. Volvo brand full year 2016 truck sales in North America plunged to 21,686 units, down 44 percent from 38,890 units in 2015. Volvo brand full year 2016 truck sales in Europe rose to 55,013 units, up 19 percent from 46,036 units in 2015. Volvo brand full year 2016 truck sales in Africa/Oceania (includes Australia, New Zealand) fell ten units slightly to 4,954, from 4,964 units in 2015. Mack brand full year 2016 truck sales (overall) plunged to 18,846 units globally, down 31 percent from 27,411 units in 2015. Mack brand full year 2016 truck sales in North America plunged to 17,167 units, down 32 percent from 25,302 units in 2015. Mack brand full year 2016 truck sales in South America plunged to 706 units, down 36 percent from 1,110 units in 2015. Mack brand full year 2016 truck sales in Africa/Oceania (includes Australia, New Zealand) rose to 971 units, up 1 percent from 958 units in 2015. Renault Truck full year 2016 brand sales (overall) rose to 47,983 units globally, up 2 percent from 46,973 units in 2015. Renault Truck full year 2016 brand sales in Europe rose to 42,896 units, up 6 percent from 40,411 units in 2015. UD (Nissan Diesel) full year 2016 brand sales (overall) rose to 20,738 units, up 4 percent from 20,025 units in 2015. UD (Nissan Diesel) full year 2016 brand sales in Asia rose to 17,091 units, up 7 percent from 16,042 units in 2015. Total Global Deliveries by Brand 2016 2015 % Change Volvo 102,857 113,066 -9 Renault Trucks 47,983 46,973 2 UD (Nissan Diesel) 20,738 20,025 4 Mack 18,846 27,411 -31 Total Deliveries 50,489 56,198 -10 Total Global Deliveries by Truck Size 2016 2015 % Change Heavy Duty (>16 metric tons) 158,025 176,589 -11 Medium Duty (7-16 metric tons) 15,691 14,749 6 Light Duty (<7 metric tons) 16,708 16,137 4 Total Deliveries 50,489 56,198 -10 Total Global Deliveries by Region 2016 2015 % Change Europe 97,909 86,448 13 North America 39,193 64,507 -39 South America 9,442 11,069 -15 Asia 31,502 31,979 -1 Africa & Oceania* 12,378 13,472 -8 Total Deliveries 50,489 56,198 -10 * includes Australia, New Zealand * Excluding Dongfeng, Dongvo (UD China) and VE Commercial Vehicles (Eicher) Quote Link to comment Share on other sites More sharing options...
kscarbel2 Posted February 5, 2017 Author Share Posted February 5, 2017 Renault Trucks’ global sales results.....versus the Volvo brand: January 2015 Renault up 24% Volvo down 4% February 2015 Renault up 26% Volvo down 13% 1st quarter 2015 Renault up 35% Volvo down 8% April 2015 Renault up 12% Volvo up 9% May 2015 Renault up 5% Volvo down 1% 2nd quarter 2015 Renault up 7% Volvo down 4% July 2015 Renault up 8% Volvo down 5% August 2015 Renault up 60% Volvo down 6% 3rd quarter 2015 Renault up 20% Volvo down 2% October 2015 Renault up 16% Volvo down 1% November 2015 Renault up 54% Volvo down 10% 4th quarter 2015 Renault up 29% Volvo down 7% Full Year 2015 Renault up 22% Volvo down 4% 1st quarter 2016 Renault up 8% Volvo down 8% 2nd quarter 2016 Renault up 12% Volvo down 9% 3rd quarter 2016 Renault down 5% Volvo down 12% 4th quarter 2016 Renault down 5% Volvo down 8% Full Year 2016 Renault up 2% Volvo down 9% Quote Link to comment Share on other sites More sharing options...
TeamsterGrrrl Posted February 5, 2017 Share Posted February 5, 2017 Interesting that Renault brand sales are growing while Volvo brand sales are falling. The trucks are similar, so are Renaults selling because they're cheaper than the equivalent Volvo, or do buyers think the Renault version is a better truck? Quote Link to comment Share on other sites More sharing options...
kscarbel2 Posted February 5, 2017 Author Share Posted February 5, 2017 4 hours ago, TeamsterGrrrl said: Interesting that Renault brand sales are growing while Volvo brand sales are falling. The trucks are similar, so are Renaults selling because they're cheaper than the equivalent Volvo, or do buyers think the Renault version is a better truck? The answer is.........Renault's "truck people" are wonderful to work with. Contrary to what Volvo Group appears to think, the folks at Renault actually know something about trucks, having sold thousands and thousands for decades before Volvo was in the picture. Quote Link to comment Share on other sites More sharing options...
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