VW says net profit leaps more than three-fold

28th July 2011, Comments 0 comments

Volkswagen, Europe's biggest car maker, said Thursday that net profit tripled in both the second quarter and first half of the year, but VW shares crashed in midday trading nonetheless.

A VW statement said net profit in the three months from April through June leapt to 4.784 billion euros ($6.86 billion) from 1.351 billion in the same period of 2010.

From January through June, the figure climbed to 6.496 billion euros from 1.824 billion.

Second-quarter sales were 21.5 percent higher at almost 40.3 billion euros, and reached nearly 77.8 billion for the first half, VW said.

Chairman Martin Winterkorn was quoted as saying that "ongoing strong demand in strategically important markets is providing a tailwind" and that a large number of new models would help underpin results going forward.

But he also cautioned that "the coming months will be challenging for us and will require us to work hard to maintain this high level."

A statement said VW expected full-year 2011 deliveries to surpass the level in 2010, and that sales and operating profit would be "significantly higher than the previous year."

Investors were disappointed that VW did not give a detailed increased outlook for the year however.

Shares in the auto giant plunged in midday trading on the Frankfurt stock exchange, losing 6.66 percent to 134.45 euros while the DAX index was down by 1.61 percent overall.

It was hard to argue with the results themselves however, as second-quarter operating profit soared by 59.2 percent to 3.17 billion euros on a 14.6 percent rise in deliveries to 2.14 billion vehicles.

The group put its net cash position on June 30 at 19.4 billion euros, a gain of 11 .1 percent from the first half of 2010.

© 2011 AFP

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