German truckmaker MAN has posted a wider than expected net loss of EUR258m (US$351m) for 2009 – due to a writedown on its stake in truckmaker Scania and fines after a bribery probe – on revenue down 20% to EUR12bn, although the group did book an operating profit of EUR504m, and warned growth was unlikely in 2010.
MAN’s new chief executive warned the company expected stagnation in 2010, dashing hopes that growth was inevitable as output would almost certainly rebound to from the heavily depressed levels of output seen last year.
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“2010 will not be a year of recovery in the classical sense but a stabilisation can be expected,” Georg Pachta-Reyhofen said in the company’s annual report.
The EUR258m net loss came after a EUR1.2bn net profit the previous year and was far below the average estimate of a EUR158m loss in a Reuters poll of 13 analysts.
The company booked EUR656m for non-recurring items, including EUR382m in writedowns largely related to its stake in Sweden’s Scania and EUR151m in fines to end a prosecutors’ probe into suspected bribery, Reuters noted.
Despite the “massive decline” in demand in the transportation sector and the heaviest drop in European commercial vehicle requirements in 80 years, MAN’s commercial vehicles division remained profitable at EUR51m. The power engineering business area posted an operating profit of EUR566m.
“[We] again generated a clear operating profit in 2009,” said Pachta-Reyhofen. “This is a remarkable success given the exceptional year we have had in the global economy and reflects the long-term strength of our group.”
Nonetheless, commercial vehicle revenue in 2009 dropped sharply by 40% to EUR6.4bn – down from EUR10.6bn the previous year – although this was partly offset by Latin America. The company saw a 43% decline in orders particularly in the heavy trucks segment.
Some EUR700m of costs were stripped out of the business and stockpiled inventories were reduced to less than 6,000 trucks. In commercial vehicle production, short-time working was used in Germany and Austria.
In the world’s largest commercial vehicles market, China, MAN has taken a stake in the market leader for heavy trucks, Sinotruk, while the group will continue to focus on the BRIC countries of Brazil, Russia, India and China.
The company declined to confirm speculation it was the subject of a potential takeover by Volkswagen, with a spokesman telling just-auto: “The VW bid is old news – it will not go away but it is not terribly current.
“There is a lot of conjecture and a lot of good and bad guesses. The VW situation will develop, almost certainly at some point.”
VW has an almost 30% stake in MAN as well as a voting stake of around 71% in Scania. MAN owns a 17.4% voting stake in Scania.
