WOLFSBURG (dpa-AFX) - Shares of Volkswagen Group were losing around 7 percent in German trading after the automaker reported Thursday a loss in its second quarter compared to prior year's profit with sharply lower deliveries. Going ahead, the company anticipates fiscal 2020 operating result, before and including special items, to be severely lower than in previous year.
Volkswagen also projects annual sales revenue and deliveries to fall significantly below the previous year's level as a result of the Covid-19 pandemic.
Frank Witter, member of the Group Board of Management responsible for Finance and IT, said, 'Due to the positive trend exhibited in our business over the past few weeks and the introduction of numerous attractive models, we look cautiously optimistic to the second half of the year.'
The company noted that the recovery of the markets continued in July, and expects its deliveries in this month to be lower than last year, albeit only single-digit percentage wise. The markets are expected to continue to recover overall in the second half of the year.
Further, at the Annual General Meeting on September 30, the Board of Management and the Supervisory Board will now propose a dividend of 4.80 euros per ordinary share and 4.86 euros per preferred share. The company's previously announced dividend for the 2019 fiscal year was 6.50 euros per ordinary share and 6.56 euros per preferred share.
For the second quarter, loss was 1.54 billion euros, compared to profit of 4.12 billion euros a year ago. Loss before tax was 2.03 billion euros, compared to profit before tax of 5.49 billion euros in the previous year.
Operating result before special items was negative 1.71 billion euros, compared to positive 5.13 billion euros last year, due to lower unit sales caused by the sharp fall in customer demand.
Group sales revenue decreased 37 percent to 41.08 billion euros from the prior year's 65.19 billion euros.
Deliveries to customers fell 31.6 percent to 1.89 million vehicles from 2.76 million vehicles last year. Vehicle sales dropped 34.7 percent from last year to 1.80 million units. Production was 1.67 million units, down 39.8 percent.
In Germany, Volkswagen shares were trading at 127.88 euros, down 7.09 percent.
Copyright RTT News/dpa-AFX