VOLVO Construction Equipment (Volvo CE) saw a 28% increase in sales in Q4, its latest financial results have shown.
Volvo CE’s “strong” performance helped its parent company, the Volvo Group, achieve the highest sales and operating income in its history, the group said in a statement.
In Q4 2017, net sales increased by 28% to SEK 16,733m. When adjusted for currency movements net sales were up to 34%. Operating income amounted to SEK 1,816m, corresponding to an operating margin of 10.9%. Earnings were positively impacted by higher sales and increased utilisation of the industrial system.
For the full year net sales increased by 31%, to SEK 66,497m. Adjusted operating income increased to SEK 7,917m, corresponding to an operating margin of 11.9%.
Growth in UK, France, Italy, Germany and the Russian market saw a 16% increase in demand in Europe by the end of November. North America was up by 10% over last year while South America saw a gain of 17%, from low levels and mostly from markets outside of Brazil. The Middle Eastern market continued to slow, weighed by weak demand from Saudi Arabia. Excluding China, Asian markets were up 11% compared to last year. The Chinese market grew by 74% above last year, driven by greater demand for excavators and wheel loaders.
The market for large excavators was up 121%, while compact excavators enjoyed an 83% improvement. By the end of November, the market for wheel loaders in China was up by 50%.
During the fourth quarter of 2017 Volvo CE saw net order intake increase by 48%, largely driven by demand in China and North America. Deliveries increased by 49% during the period, again boosted by higher volumes in China.
Melker Jernberg, the new president of Volvo Construction Equipment commented, “The performance programme to strengthen Volvo CE’s competitiveness combined with increased market demand yielded good results in 2017. Volvo CE improved profitability and gained market share in several of our stronghold segments of excavators, wheel loaders and haulers.”
In January Volvo CE announced that the Volvo brand was entering the rigid hauler market with the introduction of four new models ranging from 45 to 100-tonne.
