Volvo posted a smaller-than-expected third-quarter operating loss today thanks to sweeping cost cuts and stood by its outlook of sharp declines in its main markets.
The results were expected to dampen worries that the commercial vehicles maker, which reported its worst-ever quarterly loss earlier this year, will need to tap owners for capital in order to ride out the market plunge.
Volvo skidded to a quarterly operating loss of 3.3 billion Swedish kronas ($477 million) from a year-ago profit of 3.2 billion kronas.
Volvo, which makes trucks under the Renault, Mack, Nissan Diesel and Eicher brands, repeated that the European truck market would halve or worse this year while the already weak North American market contracts a further 30-40 per cent.
The company, which also manufactures buses, construction equipment, engines and aerospace components, said order bookings of its trucks were flat year-on-year, but the year-ago quarter was extremely weak due to a wave of order cancellations.
"The net order intake for trucks rose for the third consecutive quarter, increasing 20 percent compared with the second quarter," it said.
Volvo, which has slashed thousands of jobs to bring down costs in the face of the downturn, said cash flow was negative to the tune of 1.4 billion kronas in the quarter compared with a negative 2.9 billion kronas in the second quarter.
Reuters