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TRATON operating profit up in H1

By Niranjan Mudholkar,

Added 30 July 2019

Earnings after tax increases by 65% to €792 million

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The Industrial Business segment of Traton comprises specifically the three operating units MAN Truck & Bus, Scania Vehicles & Services, and Volkswagen Caminhões e Ônibus.

The TRATON GROUP announces strong first half-year results. During the first six months of this year, the Group increased its operating profit by €212 million compared with the prior-year period to over €1 billion. The Group generated sales revenue of €13.5 billion (previous year: €12.6 billion), representing a 7% increase compared with the first six months of 2018. The previous year figure still includes sales revenue of Volkswagen Gebrauchtfahrzeughandels und Service GmbH (VGSG), which was disposed of as of January 1, 2019, in the amount of €348 million. Adjusted for this sales revenue, the increase for the current fiscal year was 10%. During the first six months of 2019, TRATON GROUP sold 123,336 vehicles worldwide, which was also up around 10% against the prior-year figure. This growth was driven primarily by the continued favorable development of the core markets in Europe, especially Germany, and Brazil. At the same time, however, the level of order intakes in the Industrial Business segment at 120,491 units during the first six months of 2019 was 6% below the same period of 2018, driven by a decline in truck orders in the EU28+2 region, Russia, India, and Turkey as well as lower orders for buses in Mexico, Iran, and Saudi Arabia. The ratio of order intake to sales (book-to-bill ratio) was 0.98 in the first half of 2019.

Andreas Renschler, the CEO of TRATON GROUP and member of the Board of Management of Volkswagen AG, said: “Our IPO in June demonstrates that we at TRATON are executing on our goals. Looking forward, we are now running full steam ahead with implementing our Global Champion Strategy and leveraging additional synergies in the entire Group. At the same time, we are keeping a very watchful eye on developments in the market in order to adjust our production with flexibility.”

 

TRATON GROUP operates in two segments: Industrial Business and Financial Services.

The Industrial Business segment comprises specifically the three operating units MAN Truck & Bus, Scania Vehicles & Services, and Volkswagen Caminhões e Ônibus. During the first half of 2019, the Industrial Business segment generated sales revenue of €13.3 billion (previous year: €12.1 billion), with an operating profit of €1,008 million (previous year: €787 million). The significant increase in sales revenue of 10% was in particular due to the new vehicle business, driven by strong growth in the truck business. There was slight growth in the after sales business.

The Financial Services segment offers customers a wide range of financial services, including dealer and retail financing, leasing, and insurance products. During the first half of 2019, this segment recorded an operating profit of €70 million (previous year: €65 million) and sales revenue of €419 million (previous year: €380 million). A larger net portfolio and currency effects positively impacted operating profit, while lower margins and higher operating expenses were offsetting factors.

Christian Schulz, CFO of the TRATON GROUP, said: “We had a strong start to the year and have again improved on our growth of the first quarter. With an operating return on sales of 7.9% for the first half of 2019, we are clearly ahead of the same period last year. Looking ahead to the rest of the year, despite continued worsening economic indicators, we remain confident and reaffirm our targets set for the year. And furthermore, we are fully focused on the launch of the new truck generation at MAN.”

END

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