Volvo Earnings Beat Forecasts After Price Increases Help Offset Easing Demand
By Dominic Chopping
STOCKHOLM--Volvo posted forecast-beating first-quarter earnings after price increases implemented last year continued to feed through, helping offset normalizing truck orders and generally declining demand for construction equipment.
The Swedish truck maker said Wednesday that truck deliveries fell 9.9% in the quarter while order intake fell 19%.
Truck market conditions continued to normalize both in Europe and North America as transport volumes and freight rates come down from very high levels, it said.
Order backlogs and lead times have normalized in Europe and the company has gradually reduced production capacity in Europe. In North America, Mack Trucks' order backlogs are still extended.
Demand for new construction equipment has come down in many markets, particularly in Europe. Both deliveries and order intake decreased in Europe and North America but increased in China.
Volvo reported a net profit of 14.08 billion Swedish kronor ($1.28 billion) compared with SEK12.91 billion a year earlier as sales were virtually unchanged at SEK131.18 billion.
Analysts polled by FactSet had expected a net profit of SEK12.9 billion on sales of SEK129.44 billion.
Volvo maintained its 2024 truck market forecasts for Europe, North America and China, but lifted its forecast for Brazil and lowered it for India.
Write to Dominic Chopping at dominic.chopping@wsj.com
(END) Dow Jones Newswires
April 17, 2024 02:18 ET (06:18 GMT)
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