Volkswagen Q1 profit beats expectations

Bloomberg

Volkswagen AG’s first-quarter profit beat expectations and the German carmaker said it’ll meet goals on deliveries and earnings for the year, excluding special items such as legal risks.
Excluding legal items of about 1 billion euros ($1.1 billion), VW’s operating profit rose to 4.8 billion euros after boosting sales of lucrative sport utility vehicles and favourable exchange rates. The result was also positively impacted by the revaluation of financial instruments of 400 million euros.
“We have to continue to pick up the pace when it comes to our transformation,” Chief Financial Officer Frank Witter said in a statement. “We are also facing challenges in connection with increasing global economic risks.”
Carmakers have had a mixed start to the year in a shrinking global market and amid unresolved US-China trade issues. China’s passenger car market, where VW last year sold over 40 percent of its vehicles, contracted for a 10th month in a row. Deliveries at Porsche and Audi fell by 12 percent and 3.6 percent as both of VW’s two
top profit contributors grapple with the fallout from new emissions tests in Europe. Porsche also cited model changeovers.
Witter said he was “a bit more” optimistic about a demand recovery during the second half of the year, he said in an interview with Bloomberg Television. Revenue at the main VW car brand, accounting for about half of global deliveries, rose 7.1 percent.