By Kim Richters

 

Volkswagen AG reported results for the first quarter on Thursday. Here's what we watched:

 

REVENUE REVIEW: Quarterly revenue rose to 62.38 billion euros ($74.89 billion) from EUR55.05 billion the year prior thanks to increased sales volumes and stronger demand for higher-margin models, beating analysts' expectations of EUR62.28 billion, according to estimates compiled by FactSet.

 

OPERATING PROFIT REVIEW: Operating profit rose to EUR4.81 billion from EUR904 million during the same period a year earlier, when it was hit by the coronavirus pandemic. Analysts polled by FactSet had expected EUR4.98 billion, while analysts at Jefferies said consensus estimates for the quarterly result were EUR4.3 billion.

Operating return on sales was 7.7%, compared with 1.6% in the same quarter a year earlier.

 

NET PROFIT REVIEW: Net profit was EUR3.24 billion, up from EUR405 million. Volkswagen said the positive business development of the second half of last year continued in the first quarter of 2021. Cost-saving programs had a positive effect on earnings, while one-off restructuring expenses had a negative impact of EUR400 million.

 

WHAT WE WATCHED:

 

-CHIP SUPPLY: Volkswagen expects the effect of the semiconductor shortage that is weighing on the auto industry to be more significant in the second quarter than it has been so far. So far, the company has produced 100,000 fewer vehicles than planned due to the shortage.

 

-GUIDANCE: On the back of the quarterly results, Volkswagen partly lifted its full-year outlook. It now expects an operating return on sales of 5.5%-7.0% compared with a previous guidance range of 5.0%-6.5%. RBC Capital Markets said consensus expectations were already at the level of the new guidance with estimates of 6%-8%. "So some were expecting a bigger guidance raise," it said. Bernstein said its own forecast for Volkswagen's operating return on sales was already at 7.7% for the year.

 

Write to Kim Richters at kim.richters@wsj.com

 

(END) Dow Jones Newswires

May 06, 2021 06:49 ET (10:49 GMT)

Copyright (c) 2021 Dow Jones & Company, Inc.
Volkswagen (TG:VOW3)
Historical Stock Chart
From Feb 2024 to Mar 2024 Click Here for more Volkswagen Charts.
Volkswagen (TG:VOW3)
Historical Stock Chart
From Mar 2023 to Mar 2024 Click Here for more Volkswagen Charts.