THE Volkswagen Group reported considerable growth in sales revenue and earnings in the first six months of the year in a very challenging environment. Sales revenue rose by 10.1 percent to €108.8 billion (€98.8 billion) in the first half of the year, primarily due to exchange rate effects and an improved product mix. Operating profit before special items grew by 13.0 percent to €7.0 billion (€6.2 billion). Restructuring measures in the trucks business led to an operating profit after special items of €6.8 billion (€6.2 billion). The operating return on sales remained stable at 6.3 percent (6.3 percent). The Group's operating profit and sales revenue exclude the activities of the Chinese joint ventures, which are accounted for in the financial result using the equity method. At €2.7 billion (€2.6 billion), the share of operating profit attributable to the Chinese joint ventures was level year-on-year in the first half of 2015. “Our results for the first half of the year show that Volkswagen remains very well positioned in an increasingly difficult market environment and has a compelling product range,” said Prof. Dr. Martin Winterkorn, Chairman of the Board of Management of Volkswagen Aktiengesellschaft, in Wolfsburg on Wednesday. “We are keeping a very close watch on global macroeconomic trends, especially where there are uncertainties such as in the Chinese, Brazilian and Russian markets.” The Volkswagen Group's profit before tax remained almost level at €7.7 billion (€7.8 billion) despite the negative effects from fair value measurement in the financial result. Profit after tax remained unchanged as against the prior-year period, at €5.7 billion (€5.7 billion). “The difficult market environment and fierce competition, as well as interest rate and exchange rate volatility and fluctuations in raw materials prices all pose challenges. We are systematically implementing our efficiency program and are continuing to roll out the modular toolkits. We expect considerable positive effects in both instances,” said CFO Hans Dieter Pötsch. The Automotive Division's net cash flow increased considerably year-on-year to €4.8 billion (€2.9 billion) thanks to the Group's robust business model. Net liquidity in the Automotive Division amounted to €21.5 billion at the end of June (end of December: €17.6 billion). Liquidity was reduced by the capital increase in the Financial Services Division in the first quarter and the dividend payment in the second quarter, while the successful placement of hybrid notes strengthened the Automotive Division's capital base. The Automotive Division's investments in property, plant and equipment, investment property and intangible assets, excluding capitalized development costs (capex) increased to €4.7 billion (€3.6 billion). The Volkswagen Group maintained its disciplined approach to investment with a ratio of capex to sales revenue in the Automotive Division of 4.9 percent (4.1 percent). The Group invested primarily in production facilities and in the models to be launched in 2015 and 2016, as well as in the ecological focus of the model range. Global new passenger car registrations increased between January and June 2015. However, trends in the individual regions were mixed. While growth was driven by the Asia-Pacific, North America and Western Europe regions, new passenger car registrations in South America and Eastern Europe saw declines, some of which were severe. — SG
