Strong demand in Europe, Asia and Russia helped truck maker Volvo post a threefold increase in second-quarter profits, but faltering sales in North America prompted a sharp fall in the company's share price.
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In a statement Wednesday, the company said its net profit jumped to 6 billion kroner ($725 million) in the period, from 1.9 billion kronor a year earlier. Last year's profit had been dented by a 2.3 billion-kronor payment to the European Union related to a competition investigation.
Though overall sales during the quarter grew by 12 percent to 88.4 billion kronor, a disappointing performance in North America — Volvo's second-biggest market after Europe — surprised investors and the company's share price fell 4.7 percent to 140.10 kronor in Stockholm. Volvo sold 10,700 trucks in North America during the second quarter, down 11 percent on the same period in 2016, with over-capacity hampering the market.
In spite of the disappointing North American performance, CEO Martin Lundstedt said Volvo has "very competitive products and services with good positions in key markets and segments."
Europe was important for the company. Truck sales there were up 4 percent at 27,700 trucks in the quarter with an order intake 28,600 — up 7 percent on the same period in 2016.
Total global truck orders in the period were solid too, up 22 percent at 55,200.
Volvo Group, which includes trucks made by Renault and Mack, also makes buses, construction equipment and marine and industrial engines, employing some 100,000 people with production plants in 18 countries. It sells products in more than 190 markets.