Shares of Volkswagen Group were gaining around 3 percent in German trading after the automotive giant Thursday reported market recovery in the third quarter with improved deliveries in the month of September. For the first nine months of fiscal 2020, the company, meanwhile reported sharply lower earnings with weak revenues and sales volume. The company also maintained its forecast for weak results in fiscal 2020.
Looking ahead, the company said it is cautiously optimistic to be able to continue to stabilize business in the remaining months of the year.
For fiscal 2020, Volkswagen continues to anticipate that sales revenue and deliveries will be significantly down on the previous year in 2020 due to the impact of the Covid-19 pandemic.
Operating result for 2020 before and including special items would be severely lower than in previous year; however, in positive territory.
In September, global deliveries exceeded the prior year’s level for the first time this year, up 3.3 percent.
The company noted that the declines in deliveries, sales revenue and profit as of the end of September were significantly more moderate than at the half-year mark.
In the third quarter, operating result before special items was at 3.2 billion euros, slightly lower than the previous year’s 4.8 billion euros. Sales revenue in the third quarter amounted to 59.4 billion euros, down 3.4 percent from 61.4 billion euros last year. Vehicles deliveries in the quarter dropped just 1.1 percent.
For the nine months, earnings before tax decreased to 2.3 billion euros, down from last year’s 14.6 billion euros hurt by demand-related decline in sales.
Operating result before special items amounted to 2.4 billion euros, compared to 14.8 billion euros a year ago. The company said the results marked a clear return to positive territory with clearly positive result in the third quarter.
Sales revenue decreased 16.7 percent to 155.5 billion euros from 186.6 billion euros last year, heavily impacted by the Covid-19 pandemic, especially in the second quarter.
Deliveries to customers in the first nine months fell 18.7 percent to 6.5 million vehicles from 8.0 million vehicles a year ago.
Volkswagen Passenger Cars brand sold 1.9 million vehicles, down 31.1 percent from last year. Sales by the Audi brand declined to 682,000 vehicles from 900,000 vehicles last year.
In Germany, Volkswagen shares were trading at 128.60 euros, up 2.45 percent.
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