• Net sales increased by 9% to SEK 57,426 M (52,532) in the third quarter
• Income for the period rose 34% to SEK 3,939 M (2,935) in the third quarter
• Basic earnings per share rose to SEK 9.70 (7.24) in the third quarter
• Operating income excluding adjustment of goodwill rose 24% to SEK 4,972 M (4,004) in the third quarter and the operating margin rose to 8.7% (7.6)
• Increased profitability within Mack Trucks resulted in a reversal of a valuation reserve for deferred tax receivables and an adjustment of goodwill. In total, this had a positive impact of SEK 336 M on income for the period
• Operating cash flow, excluding Financial Services, in the third quarter was negative in an amount of SEK 0.4 billion (neg. SEK 0.7 billion)
• Strengthened position in Asia through increased holdings in Nissan Diesel and an agreement to acquire 70% of Lingong, a Chinese manufacturer of wheel loaders
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| Third quarter | First nine months | ||
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| 2006 | 2005 | 2006 | 2005 |
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| Net sales, SEK M | 57,426 | 52,532 | 183,070 | 165,904 |
| Operating income, SEK M 1) | 4,972 | 4,004 | 16,941 | 13,891 |
| Goodwill adjustment | (1,712) | - | (1,712) | - |
| Operating income, SEK M | 3,260 | 4,004 | 15,229 | 13,891 |
| Income after financial items, SEK M | 3,144 | 4,015 | 15,073 | 13,872 |
| Income for the period, SEK M | 3,939 | 2,935 | 12,617 | 10,113 |
| Basic earnings per share, SEK | 9.70 | 7.24 | 31.07 | 24.84 |
| Return on shareholders’ equity during most recent 12 month period, % | 19.3 | 19.0 | ||
| 1) Excluding adjustment of goodwill in the subsidiary Mack Trucks in the third quarter of 2006. | ||||
As of January 1, 2005 AB Volvo complies with International Financial Reporting Standards (IFRS), previously known as IAS, as adopted by the European Union. In the comments on earnings on pages 1-20 however, Volvo Financial Services is reported in accordance with the equity method. Financial information with Volvo Financial Services reported in accordance with the purchase method as it is stipulated by IFRS begins on page 21.
For further information, contact:
Investor Relations
Christer Johansson, +46 31 66 13 34
Joakim Wahlström, +46 31 66 11 91
John Hartwell, +1 212 418 7432
Noah Weiss, +1 212 418 7431
For the full report, see attachments