VW reports profit leap to 1.71 billion euros

27th April 2011, Comments 0 comments

Volkswagen, the biggest European carmaker, said on Wednesday that its 2011 first-quarter net profit leapt three-fold to 1.71 billion euros ($2.5 billion), though it slightly missed market expectations.

Analysts polled by Dow Jones Newswires had forecast a net profit of 1.84 billion euros for VW, which also said that for the first time it had sold two million vehicles in a single quarter.

Shares in the group soared in midday trading on the Frankfurt stock exchange, as did those of two other German car makers, Daimler and BMW.

In the first quarter of 2010, VW reported net profit of 473 million euros.

This time around, its operating profit came in at 2.9 billion euros, a much more modest gain from the 2.1 billion figure a year earlier.

As for sales, the VW group, which owns nine brands including Audi, Seat and Skoda, reported a 14 percent increase in terms of the number of vehicles and a jump of 30.8 percent in value terms to 37.5 billion euros.

A VW statement pointed to "sustained high demand in China, India, Central and Eastern Europe, and North and South America" as the main drivers behind its strong results.

It quoted finance director Dieter Poetsch as saying: "Our sound finances and continuous improvements in profitability are the basis for the Volkswagen group's successful future."

Looking at 2011 overall, VW chairman Martin Winterkorn added: "Volkswagen shifted into the fast lane in 2010 and that's exactly where we intend to stay this year."

The group confirmed that it still expects sales and operating profit to surpass the 2010 figures of 126.9 billion euros and 7.1 billion euros, respectively.

VW shares showed a gain of 3.77 percent to 125.25 euros in midday trading, while the DAX index of German blue chips was just 0.67 percent higher overall.

Daimler was up by 2.50 percent at 53.26 euros, while BMW had gained 1.91 percent to 62.89 euros.

© 2011 AFP

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