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Strong earnings for Scania in 2007

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15:04 CET+01:00
Swedish truckmaker Scania announced on Wednesday robust earnings for the fourth quarter and full-year 2007 boosted by strong demand in most markets, and forecast a smooth ride for 2008 and 2009.

In the fourth quarter, net profit soared by 48 percent to 2.7 billion kronor ($419 million) while sales increased by 29 percent to 24.5 billion, the company said.

For the full-year, net profit rose by 44 percent to 8.55 billion kronor, while sales jumped by 19 percent to 84.48 billion from a year earlier.

Scania delivered a total of 75,878 trucks in 2007, a rise of 16 percent from 2006, and 22,005 in the fourth quarter alone.

Meanwhile, order bookings grew by 26 percent for the full-year but only two percent in the final quarter.

"The demand for Scania's vehicles and services is high in most markets where Scania operates," the group said in a statement.

While growth in orders had leveled off, "there are currently few signs that the recent credit market turmoil has affected our customers' businesses," the company said.

Scania raised its forecasts for 2008 and 2009. Until now it had predicted annual sales growth of 10 percent, but said it now expected growth of more than 10 percent. Operating margins were seen unchanged at between 12 and 15 percent.

Following the news, the Scania share price rose by 2.67 percent on the Stockholm stock exchange to 134.50 kronor, in an overall market that was down by 0.23 percent.

Scania has been the target of an unwanted takeover attempt by German conglomerate MAN, and has reacted by mulling its own counteroffer.

Volkswagen, which is the biggest shareholder in both companies, reportedly favors a three-way tie-up that would include VW's Brazilian lorry activities.

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