Truck and bus maker Volvo boosted net income 211% from 1.393 million Swedish Kronors to 4.328 million for full year 2003. Fourth quarter net income rose from SEK638,000 to 1.144 million.

Full year sales fell slightly from SEK177.08 million to SEK174.768 million though fourth quarter results showed an improvement from SEK45.877 million in Q4 2002 to SEK48.733 million. Income per share improved from SEK 3.30 in 2002 to SEK 10.30 last year. For the fourth quarter it was SEK2.70 in '03, up from SEK1.50 in 2002.

Volvo's board said the results were preliminary as it awaits the outcome of ongoing discussions to divest AB Volvo's holding in Scania AB and has not made any revaluation of its holding in Scania.

Operating income from trucks more than doubled in the fourth quarter to SEK1.457 million from SEK507 million due to improved results in North America and a favourable earnings trend in Europe within both Renault and Volvo trucks.

"Our positive development continued during the fourth quarter, with sharply improved profitability and very strong cash flow. Operating income and operating margin doubled compared with the fourth quarter of 2002," the company said in a statement.

Operating income also doubled for the full year, and income per share tripled - despite sales not having increased to any significant extent.

This was due mainly to new products, "synergies" and cost savings.

Volvo said years of work to coordinate operations, from product development and purchasing to production and distribution began to have an effect on earnings in 2003.

Truck operations improved profitability as a result of reduced costs in North America, stable and high earnings capacity for Volvo trucks in Europe and increased productivity in Renault trucks.

Financial services nearly doubled operating income.

The outlook for buses is described as "fragmented", with major variations in demand between markets.

Volvo expects the European truck market to remain at today's relatively high level of 214,000 units, or increase somewhat during 2004. Customer activity rose in North America during the fourth quarter and an increase of 10-15% to about 200,000 is expected.

More growth is also expected in developing markets such as Iran and China.