MAN SE is the third-biggest truck maker in Europe and the company has recently predicted its earnings margins and revenue would fail to soar this year because of a delivery slump triggered by financial trouble in its key markets.
According to the Munich-based truckmaker, a division under the guidance of parent company Volkswagen AG – the second largest automaker in the world and the biggest in Europe – said that forecasted quotas of commercial vehicles and power-engineering orders would “slightly” dip below the sales level seen last year. Orders in 2014 also slowed down by 5 percent to 15.3 billion euros ($16.4 billion) from the same period the year before. MAN back last October also opted to cut its 2014 earnings forecast because of stagnating or dropping economies in its home region and Brazil affected order intakes – leading to a production slowdown in its factories. Even parent company Volkswagen AG announced last month it wouldn’t be able to forecast a profit growth beyond 2014’s record level because of the troubled emerging markets, such as Russia or Brazil.
MAN’s earnings before interest and taxes jumped 24 percent in 2014 to 384 million euros ($411 million), soaring above the 379.5 million-euro average of a compiled forecast made by Bloomberg News. On the other hand, deliveries plummeted 10 percent to 14.3 billion euros, while the operating profit was increased from 1.9 percent of revenue to 2.7 percent last year. Parent company VW AG has been increasingly worried about the prospects of its truck making business, trying to better reunite them under a single leadership and assist them in component sharing and other practices to reduce costs.