Volkswagen Reports Robust Operations in Fiscal Year 2015 – Special Items Impact on Result for the Ye
The Volkswagen Group’s operations developed very robustly in fiscal year 2015 in spite of the emissions issue. Consolidated sales revenue rose by 5.4 percent to EUR 213.3 billion on the back of improvements in the mix in the automotive business and the strong performance of the Financial Services Division, alongside positive exchange rate effects. The solid development of sales revenue is not reflected in the relevant earnings figures: the operating result, which had amounted to EUR 12.7 billion in 2014, stood at EUR –4.1 billion in 2015. This figure includes negative special items totaling EUR 16.9 billion. At EUR 12.8 billion, the operating profit before extraordinary charges was slightly higher than the prior-year figure.
The largest share of the special items amounting to €16.2 billion comprises provisions for the emissions issue, among other things for pending technical modifications and customer-related measures as well as global legal risks. This takes account of the identifiable risks in the 2015 annual financial statements in connection with the emissions issue.
The share of operating profit attributable to the Chinese joint ventures, whose business is not included in the Group’s sales revenue and operating result, marginally exceeded the excellent prior-year figure following a strong fourth quarter and on account of exchange rate effects. Due to the high extraordinary charges, the Volkswagen Group recorded a consolidated loss before and after tax of EUR 1.3 billion and EUR 1.4 billion, respectively.
“The Volkswagen Group’s operations are in great shape, as the figures before special items for the past fiscal year clearly show,” explained the Chairman of the Board of Management, Matthias Müller. “Were it not for the sizable provisions we made for all repercussions of the emissions issue that are now quantifiable, we would be reporting on yet another successful year overall. The current crisis – as the figures presented today also reveal – is having a huge impact on Volkswagen’s financial position. Yet we have the firm intention and the means to handle the difficult situation we are in using our own resources,” Müller added.
The Volkswagen Group’s financial situation is favorable. The sale of the shares in Suzuki, among other things, added a total of EUR 2.8 billion to the Automotive Division’s net cash flow, lifting it to EUR 8.9 billion. Net liquidity in the Automotive Division rose to EUR 24.5 (17.6) billion.
After considering all the circumstances, the Board of Management and Supervisory Board will propose to the Annual General Meeting of Volkswagen Aktiengesellschaft on June 22, 2016 that a dividend be paid. This is proposed to be €0.11 per ordinary share and €0.17 per preferred share.
The Board of Management estimates that, on the whole, deliveries to customers of the Volkswagen Group in fiscal year 2016 will be on a level with the past year due to volume growth in China. Depending on the economic conditions – particularly in South America and Russia – and the exchange rate development and in light of the emissions issue, the Board of Management expects that sales revenue for the Volkswagen Group may be down by as much as 5 percent on the previous year. In terms of the Group’s operating profit, the Board of Management anticipates an operating return on sales of between 5.0 and 6.0 percent.
“This year we are again operating in an exceedingly challenging environment in which global demand for new vehicles is declining, exchange rates and interest rates remain highly volatile and competition in many of our markets is intensifying. Added to this is the emissions issue, the extensive clarification of which will also be a dominant feature of the Volkswagen Group’s work in the current year,” Chief Financial Officer Frank Witter explained. “Regardless of this, we are confident that the Volkswagen Group will make good progress on its chosen path.”
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