Volvo Construction Equipment posted SEK 20.914 billion (about U.S. $2.458 billion) compared to SEK 16.101 billion in the first quarter last year, a 29.9-percent increase. Hikes in all regions helped Volvo CE to a 79-percent profitability increase. Adjusted for currency movements, the results were even better, up 33 percent.
Operating income was SEK 2.888 billion compared to 1.615 billion a year ago. Operating margin improved 13.8 percent, compared to 10 percent in the same period a year ago. Order intake rose by 37 percent to 23,938 machines, with increases in orders from all markets, particularly North America and Asia. Deliveries rose 35 percent during the period to 22,102 machines.
Net sales were particularly strong in Asia, with SEK 9.091 billion compared to SEK 6.136 billion a year ago, a 48.2-percent leap. In North America, first quarter revenue was SEK 3.433 billion compared to SEK 2.890 billion, an 18.8-percent increase. In Europe, revenue increased from SEK 5.730 billion in last year’s Q1 to SEK 6.599 billion in this year’s first quarter, a 15.2-percent jump. South American markets increased 29 percent and other markets went up 35 percent.
All regions did well in construction equipment. The European market was up 10 percent, driven by increased demand in Germany, Italy and parts of Eastern Europe. North America rose 21 percent, driven mainly by demand for excavators. South America continued to recover from low levels, rising 27 percent. Asia, excluding China, jumped 21 percent year over year, boosted by growth in India, Indonesia, Turkey and the Middle East. Strong demand for large excavators and wheel loaders helped the Chinese market improve by 13 percent during the quarter.
“In general, market demand is strong, and Volvo CE has continued to improve sales and profitability,” said Volvo CE president Melker Jernberg. “We are leveraging the benefits of these increased volumes well, while at the same time keeping a tight control of costs.”