MAN has reported an operating loss of €82 million for the first quarter of 2013, compared to a €254 million profit in the same period last year.
The firm says this was down to significant project-related provisions in the power plant business, lower volumes, and a sharp decline in the European market for commercial vehicles, which it was expecting.
Revenues were down by eight per cent to €3,552 million, and orders were down by 14 per cent compared to the first quarter of 2012.
Dr Georg Pachta-Reyhofen
Chief executive, Dr Georg Pachta-Reyhofen, said: “Despite the ongoing slump in the commercial vehicles market, we generated a respectable operating profit of just under one billion euros in 2012. Our customers were clearly unsettled by the euro crisis and the introduction of the Euro V emission standard in the key Brazilian market.
“This led to buyer reluctance and increased competition…
“Economic conditions will remain difficult in fiscal 2013. Order intake in the Commercial Vehicles business area declined by 12 per cent in the first three months compared with the prior-year quarter, to €3.0 billion.”
The Executive Board has initiated a range of measures to keep the company on track, aiming to cut costs, and increase efficiency in production, admin, development and sales.
“We still do not anticipate any significant economic recovery in 2013.
“We expect the European commercial vehicles business to decline; sales should return to growth in Brazil. Revenue will be down on the prior-year level in the Power Engineering business area. The MAN Group’s return on sales will be well below the 2012 figure,” said Pachta-Reyhofen.
MAN expects operating profit for the year to remain reduced, but it still expects overall 2013 revenues to be on a level with 2012.
“We have experience with pronounced economic fluctuations in our industry. In general, however, global demand for innovative solutions in the transportation and energy industry will continue to rise and guarantees long-term profitable growth.”