German Car Zone

Volkswagen improves operating profit before special items by more than 50 percent to EUR 4.4 billion


Ad hoc release: Volkswagen's Board of Management finalizes consolidated financial statements


Wolfsburg, 20 February 2007

- Volkswagen Group continues positive earnings trend in 2006 thanks to the market success of our products and improvements in our cost structures; good basis created for achieving medium-term targets

- Operating profit before special items improves by more than 50 percent to EUR 4.4 billion

- Income statement affected by special items of EUR –2.4 billion, in particular restructuring expenses in the Automotive Division, a corporation tax credit and the sale of Europcar
- Board of Management proposes a dividend increase

- Deliveries to customers increase by 9.4 percent to 5.7 million vehicles; market share in Western Europe reaches 19.9 percent (2005: 18.9 percent)

- Volkswagen Group equity ratio improves to 19.7 percent (2005: 17.8 percent); Automotive Division equity ratio rises to 28.8 percent (2005: 25.3 percent)

- Automotive Division cash flows from operating activities increase by 44.8 percent to EUR 11.7 billion

- Automotive Division investments in property, plant and equipment fall by 15.6 percent to EUR 3.6 billion, reducing ratio of investments in property, plant and equipment (capex) to sales revenue to 3.8 percent (2005: 5.0 percent)

- Automotive Division net liquidity increases to EUR 7.1 billion (2005: EUR 0.7 billion)

Automotive Division (including allocation of consolidation adjustments between the Automotive and Financial Services divisions):

Outlook

The Volkswagen Group is in a good competitive position thanks to its attractive model range. The large number of new vehicles that we will launch in 2007, in existing and new segments, will extend our product portfolio and further improve our competitive position. We are therefore expecting a slight increase in deliveries to customers in 2007 compared with the previous year. The Volkswagen Group’s 2007 sales revenue will consequently increase year-on-year. We will continue to vigorously drive forward the activities to improve cost structures and processes in 2007. This, along with the steps we undertook in 2006, will lead to a sustainable improvement in our competitiveness.

The operating profit for 2007 is expected to be above the 2006 operating profit before special items.

The Annual Press Conference will be held on March 9, 2007 in Wolfsburg.

View Financial Table here http://www.volkswagen-media-services...tlichkeit.html

Is this achieved under Pischetsrieder's old management scheme or is Martin Winterkorn's reform plan showing results already?

BP and sale of rental car firm Europcar

Hey Phaeton, I read THIS interesting article yesterday.

So that I don't hijack your thread, I have posted it in its own one