Volvo Group last week reported a fourth-quarter operating loss of slightly more than SEK 2 billion (about U.S. $272.3 million). According to the company, the main focus during the quarter was on cash flow and the Group created a positive cash flow of SEK 8.6 billion (U.S. $1.2 billion), which is one of the best cash inflows ever for a single quarter.
Net sales in the fourth quarter decreased by 23 percent to SEK 59.8 billion (U.S. $8.1 billion) from SEK 78.0 billion (U.S. $10.6 billion) in the year-ago period. For the full year, net sales decreased by 28 percent to SEK 218.4 billion (U.S. $29.7 billion) from SEK 304.6 billion (U.S. $41.5 billion).
The fourth-quarter operating loss amounted to SEK 2.3 billion (U.S. $315.3 million) compared to a loss of SEK 999 million (U.S. $136.0 million) in the fourth quarter of 2008, including restructuring and layoff-related costs, residual value write-downs and inventory write-downs of in total SEK 1.4 billion (U.S. $190.6 million). The full-year operating loss amounted to SEK 17.0 billion (U.S. $2.3 billion).
In the fourth quarter basic and diluted earnings per share amounted to a negative SEK 0.99 (negative U.S. $0.13) compared to negative SEK 0.67 (negative U.S. $0.09) in the year-ago quarter. Full-year earnings per share amounted to a negative SEK 7.26 (negative U.S. $0.99) compared to a positive SEK 4.90 (U.S. $0.67).
“As we have left 2009 behind us, I can say that, although demand remains at historically low levels, we have reduced our cost base significantly, we have reduced our inventory and lowered our capital tied-up, and that we are financially stable thanks to low refinancing requirements combined with good liquidity,” said Leif Johansson, president and CEO. “We have also continued to invest in research and development to be able to launch competitive products in the next few years. Therefore I have a very positive view on the Group’s possibilities to strengthen its positions on the world market.”
The board of directors proposed that no dividend be distributed for the year 2009. In 2008 the company distributed a dividend of SEK 2.00 per share (U.S. $0.27).
Headquartered in Göteborg, Sweden, the Volvo Group is one of the world’s leading manufacturers of trucks, buses and construction equipment, drive systems for marine and industrial applications, aerospace components and services. The Group also provides complete solutions for financing and service. The Volvo Group, which employs about 100,000 people, has production facilities in 19 countries and sells its products in more than 180 markets.