Volvo Construction Equipment, net sales by market area (SEKm)
Construction Equipment (CE) posted increases in net sales and profitability in the first financial quarter of 2019, driven by growth in most major markets.
During the first three months of 2019 the construction equipment manufacturer saw net sales jump by 15% to SEK24,155m (€2,300m), compared to SEK20,914m (€1,991m) in Q1 2018. These higher sales, plus improved prices and product mix, helped to positively impact operating income, which rose to SEK3,646m (€347.1m), up by 26% compared to SEK 2,888m (€274.98m) in Q1 2018. This was reflected in operating margin, which also saw strong improvement at 15.1%, compared to 13.8% in the same period the year before.
Deliveries increased by 5% to 23,139 machines in Q1, compared to 22,102 machines in Q1 2018.
Volvo CE says that the major global construction equipment markets of Europe and North America both saw growth during Q1, expanding by 3% and 4% respectively in the first two months of the year.
It adds that the European market was driven by good demand from Germany, the UK and Italy, while growth in North America was boosted by growing demand for large wheeled loaders, road equipment and articulated haulers. A recovering Brazil helped demand in South America rise by 5% during Q1, while Asia (not including China) slipped 4% compared to the same period last year. China delivered stronger demand than expected, rising 23% compared to the first quarter of 2018.
“The global market for construction equipment remained good in the first quarter,” said Volvo CE president Melker Jernberg. “We are successfully managing these increases in volumes, and this good cost control is helping to deliver encouraging levels of operating income and operating margin.”