Volvo Earnings Beat Forecasts Amid Surging Demand, Cautions on Semiconductor Disruption
April 22 2021 - 2:41AM
Dow Jones News
By Dominic Chopping
STOCKHOLM--Volvo AB on Thursday posted forecast-beating earnings
amid surging demand for trucks and construction equipment, but
cautioned on further production disruptions amid the global
semiconductor shortage.
The Swedish truck maker said first-quarter net profit rose 89%
on year to 8.84 billion Swedish kronor ($1.05 billion), beating a
FactSet analyst forecast of SEK6.87 billion.
Sales rose to SEK94.02 billion, beating a forecast of SEK93.55
billion.
Truck deliveries rose 17% in the quarter to 52,444 trucks, while
order intake more than doubled to 85,461 trucks, it said.
The company said a strong freight market with increased
transport volumes, not least driven by e-commerce, and rising
freight prices is seeing customers renew and expand their fleets to
meet increased demand.
However, previously announced stop days in truck production
during the second quarter will go ahead due to the global shortage
of semiconductors, with the supply chain remaining unstable.
"We can therefore not rule out further disruptions in both the
truck business and other parts of the group," Chief Executive
Martin Lundstedt said.
In construction equipment, many countries are investing in aging
infrastructure while construction activity in several other sectors
is also driving demand, it said.
Volvo backed its 2021 truck market forecasts in all regions
except China, where it now sees the heavy- and medium-duty truck
market at 1.56 million from 1.43 million.
Write to Dominic Chopping at dominic.chopping@wsj.com
(END) Dow Jones Newswires
April 22, 2021 02:26 ET (06:26 GMT)
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