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Scania Year-end Report January-December 2010

Scania’s earnings and cash flow for the full year 2010 were the best ever in the company’s history. Operating income rose to SEK 12,746 m.

Summary

  • Operating income rose to SEK 12,746 m. (2,473), and earnings per share rose to SEK 11.38 (1.41)
  • Net sales increased by 26 percent to SEK 78,168 m. (62,074)
  • Cash flow amounted to SEK 11,880 m. (5,512) in Vehicles and Services
  • The Board of Directors proposes a dividend of SEK 5.00 (1.00) per sharePlease see the attached pdf for more information.

Comments by Leif Östling, President and CEO

“Scania’s earnings and cash flow for the full year 2010 were the best ever in the company’s history. Operating income rose to SEK 12,746 m. Higher vehicle and service volume and significantly higher capacity utilisation mainly explain the improvements. The global economic recove ry led to increased activity in the transport industry during 2010, with a number of markets outside Europe quickly rebounding after the downturn. The Brazilian market, which has been strong due to high economic activity as well as tax breaks and interest rate subsidies, has now stabilised at a high level. Scania has taken advantage of the Group’s common global product range and production structure, which has enabled the company to meet the strong demand for vehicles and parts in Latin America. Demand in Europe improved gradually during 2 010 and freight prices began to recover. The Russian truck market recovered strongly during the fourth quarter. Service volume in Europe gained momentum during the second half of 2010, leading to hig her capacity utilisation in workshops. The daily production rate at Scania’s production units increased continuously during 2010 and Sc ania has been able to maintain short delivery times. Scania has increased its workforce, and to ensure flexibility new employees have been hired on temporary contracts. Since autumn 2010, Scania and MAN have been investigating a possible combination. No decision has been made, since there are a number of outstanding issues of a commerci al and legal nature. There is a continued risk of bottlenecks among both sub-contract ors and bodybuilding companie s. Scania expects a level of demand in early 2011 similar to the level seen in the se cond half of 2010. The negat ive effects of the stronger SEK, which impacted the fourth quarte r of 2010, will be more pronounced during the first quarter of 2011.”

For more information please see attached pdf.