Scania Interim Report January-June 2017

News provided by

Jul 28, 2017, 01:34 ET

SÖDERTÄLJE, Sweden, July 28, 2017 /PRNewswire/ -- Scania's net sales rose to a record high SEK 58.7 billion, an increase of 17 percent compared to last year.

Summary of the first six months of 2017

Operating income rose to SEK 6,464 m. (1,316)

Operating income, excluding items affecting comparability, amounts to SEK 6,464 m. (5,116)

Net sales increased by 17 percent to SEK 58,738 m. (50,110)

Cash flow amounted to SEK 3,291 m. (-492) in Vehicles and Services

Comments by Henrik Henriksson, President and CEO

"Scania's net sales rose to a record high SEK 58.7 billion, an increase of 17 percent compared to last year. The period was affected by a high investment level and increased production costs for double product ranges. In spite of this, the company delivered a very strong performance thanks to strong demand for the new truck range and a continued positive trend in services. Earnings in the first half of 2017 amounted to SEK 6,464 m., giving an operating margin of 11.0 percent. Order bookings for trucks rose by 29 percent compared to the same period last year. Demand for trucks in Europe is holding up due to the favourable economic situation and Scania's market share for trucks in Europe remains strong at 16.8 percent. The trend in Latin America is positive and we see increased demand in Brazil from very low levels, mainly related to increased activity in the agricultural sector. In Eurasia, the trend in demand is positive as Russia is continuing to recover. In Asia, demand increased thanks to a good sales performance, particularly in China and Iran. In Asia, the European truck segment is growing in line with the advancement of the logistics systems − a development largely driven by the major e-commerce players. Order bookings in Buses and Coaches remained strong overall but fell slightly compared to the same period in 2016. In the business area Engines, the demand trend is positive in all three segments, industrial, marine and power generation. Service revenue amounted to a record high SEK 11.7 billion, an increase of 12 percent. This was driven by high uptime in customer vehicle fleets and an increase in services directly or indirectly generated from the 270,000 connected vehicles in the Scania fleet. Connectivity is an important business driver, which is enabling Scania to offer customers more efficient services aimed at improving their profitability. Financial Services reported operating income of SEK 520 million and credit losses remain at low levels."