Volvo CE sees 16% drop in revenues for 2013
06 February 2014
Construction equipment manufacturer Volvo CE reported revenues of SEK53.4 billion (€6 billion) for 2013, down 16% compared to 2012.
Its operating income also took a hit, dropping from SEK5.67 billion (€641 million) in 2012 to SEK2.59 billion (€293 million) last year.
The manufacturer said general weak market conditions experienced during the year had taken their toll on results.
It added that operating income had been affected by tough price competition, a weak product mix, low capacity utilisation and unfavourable exchange rates. The operating margin was also hit, slipping to 4.9% in 2013 from 8.9% in 2012.
In terms of units, Volvo CE delivered 70,786 machines in 2013, down 6% year-on-year. The biggest drop was recorded in North America, where unit sales were down 23% and revenues were down 31%.
The company – which in December last year announced a deal to acquire the hauler business of rival manufacturer Terex for US$160 million (€118 million) – said it expected to see some improvements in 2014 as global markets recovered.
It said total construction equipment markets in China and Europe were expected to increase in the range of 0 to 10% measured in units, while North America, South America and Asia (excluding China) were all expected to see growth in the range of -5% to +5%.
Martin Weissburg, the incoming president of Volvo CE, said, “For 2014, we expect a slight improvement in market demand, mainly driven by China and Europe.”
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