The German carmaker managed to thoroughly beat analyst expectations, as its first quarter profit jumped 22% on record increases at the Audi and Porsche divisions.
The rather unexpected big surge in operating profit has now left analysts expecting the carmaker to soon revise its full year forecast, to better reflect the gains. In February, the automaker posted a rather cautious earnings guidance, forecasting its operating margin for 2014 in between 5.5 and 6.5%, from the 5.9% it made in 2013.
“There’s an 80 percent chance VW will raise its guidance in the next three to four months,” said Frankfurt-based Metzler Bank analyst Juergen Pieper.
“It’s more important than ever that we focus on three key areas – disciplined cost and investment management, profitability targets and improved profitability in all regions,” finance chief Hans-Dieter Poetsch said.
Europe’s car sales, with the region accounting for around 40% of the automaker’s sales, have recorded in March their seventh straight month of gains, with Volkswagen even having to run additional production shifts in order to meet increased demand for some models, like the Golf or Tiguan.
With Audi and Porsche accounting for around two thirds of the group’s total profit, the operating profit surely jumped, as Audi increased first quarter deliveries by 11.7% to 413,000 units and Porsche grew 4.5% to 38,700 cars.