Volvo earnings hit by weak North American market

AP News
Posted: Jul 19, 2016 9:01 AM

HELSINKI (AP) — Swedish truck maker AB Volvo says second-quarter profits dropped 38 percent as sales fell amid lower demand in America and emerging markets.

Net profit dropped to 1.9 billion kronor ($222 million) from 5.2 billion kronor a year earlier, mainly because of provisions relating to an EU antitrust case and restructuring charges. Revenue fell 7 percent to 79 billion kronor, with total deliveries of trucks down 5 percent in the period. The company predicted sales volumes would continue to be weak in North America.

CEO Martin Lundstedt said Tuesday that despite poorer sales, operating income and margins had improved, cost cutting "continued to yield results" and sales were picking up in Europe.

Volvo's share price was up more than 2.5 percent at 91.10 kronor in afternoon trading in Stockholm.