WOLFSBURG (dpa-AFX) - Volkswagen AG (VKW.L, VLKAF.PK, VOW.BE) reported a profit for fiscal year 2017 that more than doubled from last year, reflecting higher sales of its major marques and the effect of cost-cutting at its VW brand. Annual revenue rose 6.2%, while unit sales increased 4.3% to 10.7 million vehicles. The Volkswagen Group expects to moderately exceed its latest record delivery figures in the current fiscal year.
'The excellent financial result provides a strong basis for this and gives us every reason to be confident. In fact, our plan for the future, TOGETHER - Strategy 2025, is taking effect and becoming increasingly tangible,' said Matthias Müller, CEO of Volkswagen AG.
Volkswagen said it would propose an increase in its dividend, to 3.90 euros on ordinary shares and 3.96 euros on preferred shares from 2 euros and 2.06 euros, respectively.
The Board of Management of the Volkswagen Group expects the pace of global economic growth to slow slightly in 2018 and trends in the passenger car markets in the individual regions to be mixed in 2018. The Board of Management estimates that deliveries to customers of the Volkswagen Group in 2018 will moderately exceed the prior-year figure amid continuously challenging market conditions.
Challenges in the current fiscal year will arise mainly from the economic situation, increasing competition, exchange rate volatility and the diesel issue. In the EU, there is also a new, more time-consuming test procedure for determining pollutant and CO2 emissions as well as fuel consumption in passenger cars and light commercial vehicles (WLTP).
For 2018, the Board of Management estimates that sales revenue for the Volkswagen Group may be up by as much as 5 percent on the prior-year figure. In terms of the Group's operating profit, the Board of Management anticipates an operating return on sales of between 6.5 and 7.5 percent.
Preliminary profit attributable to shareholders for fiscal year 2017 surged to 11.35 billion euros from 5.14 billion euros last year. Earnings per basic share rose to 22.63 euros from 10.24 euros in the previous year.
The share of operating profit attributable to the Chinese joint ventures (4.7 billion euros) was down slightly in the reporting period. The business of the Chinese joint ventures is not included in the Group's sales revenue and operating profit because it is accounted for in the financial result using the equity method.
Annual operating profit before special items grew to 17.04 billion euros from the prior year's 14.62 billion euros, mainly the result of volume-, mix- and margin-related factors as well as improvements in product costs. Special items contained in operating profit totaled EUR -3.2 (-7.5) billion for 2017 as a whole. The special items related exclusively to charges incurred in the Passenger Cars Business Area due to the diesel issue, driven specifically by higher expenses for buy-back and retrofit programs for 2.0 and 3.0 l TDI vehicles in North America as well as higher legal risks.
Total sales revenue for the fiscal year 2017 rose 6.2% to 230.68 billion euros from 217.27 billion euros in the previous year, mainly due to strong unit sales as well as the healthy performance of the Financial Services Division; exchange rates had a negative effect.
Copyright RTT News/dpa-AFX