Volkswagen keeps outlook, warns of Ukraine war, energy shortage in Europe

Volkswagen confirmed its outlook for the year on Thursday as supply chain bottlenecks in items from wire harnesses to chips eased, but warned of the Ukraine war and threats to European energy supply.

By Victoria Waldersee

BERLIN (Reuters) -Volkswagen confirmed its outlook for the year on Thursday as supply chain bottlenecks in items from wire harnesses to chips eased, but warned the war in Ukraine and threats to European energy supply loomed over the second half.

The carmaker saw a 27.7% fall in operating profit before special items to 4.7 billion euros ($4.8 billion) in the second quarter, despite a 3.3% rise in revenues as negative effects from commodity hedging transactions weighed on results.

Across the first six months of the year, it saw 16.1% growth in operating profit to 13.2 billion euros.

 

"The group expects the product mix to normalise in the second half of the year as the semiconductor situation improves and the company benefits from a strong order backlog," Chief Financial Officer (CFO) Arno Antlitz said.

Antlitz is due to take on the role of chief operating officer at Volkswagen from Sept. 1, alongside his position as CFO, when a reshuffle at the helm announced last Friday takes effect. That also ousted chief executive Herbert Diess in favour of Oliver Blume, CEO of luxury brand Porsche.

Volkswagen said in April the war in Ukraine could call its full-year outlook into question but has stuck with it since then, expecting sales to rise 8%-13%, an operating profit margin of 7.0%-8.5% and an increase in deliveries of 5-10%.

Sales fell by around a fifth in the first half of the year, with Europe hardest hit amid supply chain bottlenecks related in part to the war in Ukraine.

"Particularly in Europe, uncertainty exists around energy supply," the carmaker said.

($1 = 0.9802 euros)

(Reporting by Victoria Waldersee Editing by Rachel More and Mark Potter)