Financial targets

  • The annual organic sales growth for the truck, bus and construction equipment operations, as well as Volvo Penta, shall be equal to or exceed a weighted-average for comparable competitors.

 

  • Each year, the operating margin for the truck, bus and construction equipment operations, as well as Volvo Penta, shall be ranked among the top two companies when benchmarked against relevant competitors.

 

  • The capital structure target is set to a net financial debt, excluding provisions for post-employment benefits, for the Industrial Operations of a maximum of 35% of shareholders’ equity under normal conditions. As of January 1, 2013, new accounting rules for employee benefits came into effect. As a consequence, AB Volvo’s Board of Directors decided to exclude pension obligations from the target. The new target corresponds to the previous financial target of 40% in which pension obligations were included.

 

  • The Customer Finance Operations, has a target of 12-15% return of equity (ROE) and an equity/assets ratio exceeding 8%. 

 

To facilitate comparisons, the truck operations will be measured jointly with the bus operations and the construction equipment operations will be measured jointly with Volvo Penta. The comparisons will be made in accordance with the table below:
 

Trucks and buses

Volvo CE and Volvo Penta

Daimler Brunswick
Iveco CAT
MAN  CNH
Navistar Cummins
Paccar Deere
Scania Hitachi
Sinotruk Komatsu
Terex


Further information on the outcome is available in the Volvo Group's Annual Report.