Volkswagen: lowers margin target for FY 2024
(CercleFinance.com) - On Tuesday evening, Volkswagen lowered its margin target for 2024 due to costs linked to the restructuring of a plant belonging to its Audi subsidiary in Brussels, which could be subject to closure in the near future.
This decision, which is due to changes in demand for the Audi Q8 e-tron range produced at the site, is expected to have a "significant" impact on the Group's operating income this year, the German automaker warns.
VW also mentions foreign exchange losses, as well as provisions relating to the planned closure of another site, a gas turbine production unit belonging to its subsidiary MAN Energy Solutions.
Volkswagen points out that, last April, it had also announced the recognition of a charge of E900m linked to staff reductions in Volkswagen AG's administrative teams.
All in all, these items are expected to weigh on the company to the tune of E2.6bn for the full year, a financial burden that the Group does not believe it will be able to offset through cost-cutting measures.
As a result of these factors, the automaker now expects its annual margin to come in at between 6.5% and 7%, whereas it had previously forecast a figure of between 7% and 7.5%.
This warning was greeted with little emotion on the Frankfurt Stock Exchange on Wednesday, where VW shares nevertheless gained 0.5% in early trading.
Knowing that the closure of the Brussels plant will take time, we do not expect the associated costs to have a material impact on cash flow in the immediate future", Deutsche Bank analysts tempered this morning.
Other professionals point out that all the group's other key targets remain unchanged for this year.
Copyright (c) 2024 CercleFinance.com. All rights reserved.
This decision, which is due to changes in demand for the Audi Q8 e-tron range produced at the site, is expected to have a "significant" impact on the Group's operating income this year, the German automaker warns.
VW also mentions foreign exchange losses, as well as provisions relating to the planned closure of another site, a gas turbine production unit belonging to its subsidiary MAN Energy Solutions.
Volkswagen points out that, last April, it had also announced the recognition of a charge of E900m linked to staff reductions in Volkswagen AG's administrative teams.
All in all, these items are expected to weigh on the company to the tune of E2.6bn for the full year, a financial burden that the Group does not believe it will be able to offset through cost-cutting measures.
As a result of these factors, the automaker now expects its annual margin to come in at between 6.5% and 7%, whereas it had previously forecast a figure of between 7% and 7.5%.
This warning was greeted with little emotion on the Frankfurt Stock Exchange on Wednesday, where VW shares nevertheless gained 0.5% in early trading.
Knowing that the closure of the Brussels plant will take time, we do not expect the associated costs to have a material impact on cash flow in the immediate future", Deutsche Bank analysts tempered this morning.
Other professionals point out that all the group's other key targets remain unchanged for this year.
Copyright (c) 2024 CercleFinance.com. All rights reserved.