Volkswagen Group experienced a sharp drop in first-quarter earnings but stuck to its goal of an improvement in operating profit in 2004. Operating profit for the group slumped to just 329 million euros in the first quarter from 604 million euros a year earlier.
VW posted an even sharper decline in net income to 26 million euros from 202 million euros in 2003, despite a six percent rise in revenues to 21.95 billion euros, Reuters reported.
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According to a Reuters poll of 22 analysts, the market had forecast operating profit of 310 million euros and net income of 106 million euros on sales of 20.6 billion euros.
Earlier this month, the carmaker said it had delivered a total of 1.2 million vehicles during the first quarter, a rise of 0.6 percent, Reuters said.
Chief Executive Bernd Pischetsrieder had previously warned that first-quarter earnings would be ‘lousy,’ but said the company would remain in the black.
Volkswagen said demand for its flagship Golf V model is rising strongly and reaffirmed its target of earning more than 2.5 billion euros in operating profit before special items in 2004, Reuters said.
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