Increasing demand in key markets and cost control measures boost company, with significant improvements in both sales and earnings
Volvo Construction Equipment (Volvo CE) has reported a rise of 36% in net sales in the second quarter of 2017, compared to the same period in the year before.
A statement from the company cited good cost control as volumes return resulted in a significant improvement in profitability, with net sales in the second quarter amounting to $2,255 million, as compared to $1,660 million in Q2 2016.
Operating income was also strongly up, at $299.7m in the period, more than three times the $98.6m reported in the same period the year before, equating to an operating margin of 13.3%.
The second quarter of 2017 also saw order intake increase by 54%, while deliveries in the period were up 49%, at 17,472 machines. Order intake in China was particularly strong, rising by 221%, driven by increased demand for SDLG wheel loaders and SDLG and Volvo excavators.
The second quarter of 2017 saw increased demand in most major markets. Europe was up 14%, while North and South America both saw a 4% improvement. Asia (excluding China) was up 8%, while the Chinese market was up almost two thirds, at 65%.
“Demand for construction equipment continues to improve in Europe and China (and there is) also a clear recovery in the mining segment in many parts of the world,” said Martin Weissburg, president, Volvo CE.
“Thanks to Volvo CE keeping tight control over costs as volumes return, these increased sales have resulted in a significant improvement in profitability. In general, Volvo CE has competitive products and services, with good positions in key markets. We will continue to focus on core products and segments, continuous improvement, lowering costs and improving quality.”