Volkswagen's 3Q Results Weighed by Costs; Flags Supply-Chain Issues -- Update

   By Kim Richters 
 

Volkswagen AG on Friday posted third-quarter operating profit that missed analysts' estimates as it was dragged by one-off costs, while the car maker cut its vehicle sales outlook due to continued supply-chain constraints.

The German auto maker said operating profit rose to 4.27 billion euros ($4.26 billion) from EUR2.60 billion with the corresponding return on sales increasing to 6.0% from 4.6%.

However, profit was hit by nonrecurring costs of around EUR1.6 billion related to its activities in Russia and the Porsche AG IPO, and missed consensus estimates of EUR4.71 billion, according to a Factset forecast.

Other burdens in the quarter included a EUR1.9 billion noncash impairment charge connected to the withdrawal from the Argo AI investment, the company said.

Quarterly revenue rose 24% to EUR70.71 billion, supported by the performance of its premium, sport and luxury segments, and slightly higher than analysts' forecast of EUR70.36 billion, according to consensus estimates from FactSet.

Volkswagen confirmed it plans to reach the upper end of the 7.0%-8.5% operating-margin guidance and also the higher end of its revenue-growth target this year.

However, the car maker cut its vehicle sales outlook for the year and now expects deliveries similar to last year due to continued supply-chain constraints. It previously expected a 5%-10% increase. It also said other challenges include increasing competitive intensity and stricter emissions-related requirements.

At 0926 GMT, preferred shares in Volkswagen were down 2.7% at EUR127.14.

Write to Kim Richters at [e-mail]

(END) Dow Jones Newswires

October 28, 2022 05:42 ET (09:42 GMT)

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