STOCKHOLM, Sweden, Jan. 28, 2002 (PRIMEZONE) -- Scania (NYSE:SCVa) (NYSE:SCVb):
"After the unsatisfactory 2001, our measures to adjust production to lower global demand, structural changes related to cab production and buses as well as stricter prices will gradually show their effect during this year," said Leif Ostling, President and CEO.
2001 IN Change
BRIEF Full year in Fourth quarter
%
Units USD 2001 2000 USD 2001 2000
m.* m.*
Trucks
and buses
- Order 48,719 55,565 -12 12,835 14,845
bookings
- Sales 48,331 56,492 -14 13,166 17,076
Sales and earnings(1) SEK m.unless otherwise stated
Sales 4,974 53,065 51,398 3 1,422 15,165 15,195
Operating 231 2,467 5,084 -51 43 463 2,027
income
Income 144 1,541 4,454 -65 2 17 1,866
after
financial
items
Net 98 1,048 3,080 -66 1 11 1,289
income
Operating
margin, 4.6 9.9 3.1 13.3
Scania
Group,
percent
Operating
margin, 5.0 10.7 3.2 13.9
Scania
products(2)
percent
Return on 6.5 21.6
equity,
percent
Return on
capital
employed, 8.4 19.7
excluding
customer
finance
operations,
percent
Earnings 0.49 5.24 15.40 0.00 0.05 6.45
per
share,
SEK
Cash flow 281 2,995 3,014 58 619 113
before
acquisitions
Number of 28,342 27,366
employees
Dec. 31
Number of shares: 200 million
Proposed dividend for 2001: SEK 3.50 per share (7.00).
Unless otherwise stated, all comparisons in brackets refer to
the same period of last year. This report is also available at
www.scania.com
(*) Translated solely for the convenience of the reader at a closing
exchange rate of SEK 10.6675 = USD 1.00.
(1) Beginning with 2001, the Scania Group is applying recommendation
RR 11 of the Swedish Financial Accounting Standards Council on
revenue recognition. See page 6.
(2) Trucks, buses, engines and service-related products.
SCANIA IN 2001 - COMMENTS BY THE PRESIDENT AND CEO
"In 2001 the Group showed an operating income of SEK 2,356 m. for Scania products. Weak economic trends in Scania's largest markets resulted in lower transport service needs, which caused truck sales to fall during the year. Sales of service-related products rose and growth continued in our customer finance operations, with a further improvement in earnings. To summarize, it has been a troublesome year, with diminished volume and lower operating income, mainly in Latin America," Leif Ostling noted.
"The total market in western Europe began to fall after three years of growth. Measured as the number of registrations, the market shrank by four percent to about 235,000 heavy trucks. In terms of order bookings, demand shrank considerably more. Due to the increased flexibility of Scania's production system in recent years, we were able to deliver a record volume in 2000, while maintaining short delivery times. As a result, in 2000 we enjoyed a market share of 15.6 percent. In 2001 our market share fell to 13.5 percent, since a number of competitors registered many trucks ordered from them in 2000 only during 2001 and we abstained from a number of transactions -- mainly related to trucks with lower specifications for large fleets -- where the price levels had become too low.
"Due to weak economic growth in western Europe, demand for heavy trucks may fall to between 180,000 and 190,000 this year. Scania is continuously adjusting its production capacity to order bookings. About 1,200 employees, most of them on short-term contracts, have left Scania's European production system since the end of 2000. This year, about 500 additional short-term contracts will not be renewed, among other things since cab production is being concentrated at Oskarshamn, Sweden.
"In Latin America and especially in Argentina, the year was characterized by major economic problems. We have taken steps to improve profitability. In Brazil we are raising prices to compensate for the unfavourable currency rate developments that have occurred. Meanwhile we are implementing cost reductions, mainly in the form of a cutback of about 250 persons and an increase in the share of purchases from national suppliers. In Argentina, we are adjusting our operations to changed and highly uncertain conditions, among other things through cutbacks in the number of employees. Despite the prevailing uncertainty, it is our ambition to return to profitability in Latin America as early as possible.
"We are restructuring our European bus and coach operations in order to improve profitability. All development work, purchasing, marketing and bus chassis production is being moved to Sodertalje in order to benefit from co-ordination with trucks. In nearby Katrineholm, Scania is concentrating its development and production of bus bodies in a separate company.
"We continued to strengthen our service and distribution network. In January 2001 we bought the remaining 50 percent of the outstanding shares in Beers, our distributor in the Netherlands, as well as two Brazilian sales and service companies.
"After the disappointing 2001, our measures to adjust production to lower global demand, structural changes related to cab production and buses, as well as stricter prices will gradually show their effect during this year," Mr. Ostling concluded.
This information was brought to you by Waymaker http://www.waymaker.net
To view the full text and financial tables please click on the following links: http://www.waymaker.net/bitonline/2002/01/28/20020128BIT00810/bit0002.doc The full year-end-report http://www.waymaker.net/bitonline/2002/01/28/20020128BIT00810/bit0002.pdf The full year-end-report