Volvo Construction Equipment's sales in the second quarter of 2013 were down 19 percent. Despite lower sales, the company's cost and inventory control measures allowed operating margin to more than double, compared to the first quarter of 2013.
Underlying positives include good order intake and improving trends in China, Europe and the Middle East. And
Net sales in the second quarter decreased by 19%, amounting to SEK 16,019 million ($2.5 billion). Adjusted for currency movements net sales decreased by 14 percent. Operating income plunged 52 percent to SEK 1,324 million ($203 million).
Operating margin at 8.3 percent more than doubled that of Q1 2013, but was down from 13.9 percent in the same period last year. The drop was due to lower sales in higher-margin mining equipment. Despite the weaker market conditions, the value of Volvo CE’s order book at the end of the second quarter was nearly the same level as the same period last year.
2013 Outlook
Unit sales for the full year 2013 in Europe are anticipated to decline 5 to 15 percent, while expectations regarding North America, South America, China and the rest of Asia are all expected to be in the range of minus 5 to plus 5 percent.
