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Volvo Group Q3 Adj. Operating Income Declines; Adj. Net Sales Down 16%

Volvo Group reported that its third quarter net income to owners declined year-on-year to 5.72 billion Swedish kronor from 7.45 billion kronor, last year. Earnings per share was 2.81 kronor compared to 3.67 kronor. Adjusted operating income was 7.22 billion kronor compared to 10.89 billion kronor, previous year. The Group said the the lower adjusted operating income year-over-year is mainly an effect of reductions in vehicle volumes and lower capacity utilization in the industrial system, which were partly offset by good cost execution across the Group.

Third quarter net sales were 76.85 billion Swedish kronor compared to 98.72 billion kronor, prior year. Adjusted for currency movements, net sales were down 16%, for the quarter. Vehicle sales declined by 21% adjusted for currency movements, primarily related to North America and Europe. Adjusted for currency movements, service sales were down 1%.

"The weak order intake in the previous quarter impacted the Group's net sales in third quarter. Our service business is more stable, with currency-adjusted revenues coming down by only 1% compared to third quarter last year and with a sequential improvement. Despite the sales decline we achieved an adjusted operating margin of 9.4% thanks to significant cost reductions," said Martin Lundstedt, CEO.

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