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Volkswagen Group reports loss, gives 2015 profit warning

Volkswagen Group has today reported a €3.48 billion (£2.5bn) operating loss for the third quarter of the year, and a €2.52bn (£1.8bn) pre-tax loss, due to the cost of the emissions scandal.

The manufacturer has set aside €6.7bn (£4.8bn) to cover the costs of the scandal, resulting in the first net loss in 15 years.

In September, the Volkswagen Group admitted installing a piece of software designed to cheat emissions tests in 11 million of its diesel cars worldwide, including Seat, Škoda and Audi models as well as Volkswagen cars and vans.

Matthias Müller, chief executive and chairman of the board of management, said: "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."

The Volkswagen brand’s operating profit before special items relating to the diesel issue rose to £1.6bn (€2.2bn).

Audi lifted its operating profit to £2.9bn (€4bn) and at Škoda it increased to £530m (€734m). Seat, meanwhile, reported an increase in operating profit to £8m (€12m) and Volkswagen Commercial Vehicles posted an operating profit of £225m (€313m).

Operating profit at Volkswagen Financial Services amounted to £1bn (€1.4bn) on the back of positive volume and exchange rate effects.

The Volkswagen Group expects deliveries to customers in 2015 to remain on a level with the previous year, with sales revenue and its business areas is expected to increase by up to 4%.

However, a statement from the group reads: “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 to be down significantly year-on-year.

“We expect an operating return on sales before special items of between 5.5 and 6.5% for the group's operating profit; this will amount to between six and seven per cent in the passenger cars business.”

Financial performance by brand - Jan 1 - Sept 30

  Sales revenue (€m)   Operating profit (€m)   Operating margin %  
  2015 2014 2015 2014 2015 2014
Volkswagen 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
Skoda 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
VW Commercials 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
* inc financial services            

 

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