Volkswagen (OTCPK:VWAGY) stock rose sharply after forecasting strong sales momentum and easing supply chain constraints in the year ahead.
In an annual report released on Friday, the automaker said that automotive revenue rose 12% from the prior year to €279.2B in 2022 as a decline in vehicle deliveries was offset by positive price dynamics. The manufacturer reported an operating profit margin improved to 8.1%, bolstered by mix and pricing. Liquidity was also improved due to the IPO of the Porsche (OTCPK:POAHY) business during the year.
“Our performance last year demonstrated the improved resilience of the Volkswagen Group amid a challenging global backdrop,” CFO and COO Arno Antlitz said. “Despite significant supply chain challenges leading to a decline in overall delivery numbers, we delivered 572,100 all-electric vehicles and simultaneously further increased operating profits. Today’s results provide more evidence of solid financial foundations on which we consistently implement our strategy. We expect the supply chain bottlenecks to gradually ease in the current year, allowing us to service the high order backlog.”
Based upon these improving dynamics, the automaker expects to deliver around 9.5M vehicles in 2023, up from 8.23M in 2022. The company said that its ability to capitalize on a robust order backlog and the easing of semiconductor supply and logistics chain issues should help drive the significant jump in deliveries anticipated. The group expects sales revenues to be 10% to 15% higher than 2022 as well, with operating return on sales in the range of 7.5% to 8.5%.
Shares of the German auto group drove nearly 10% higher in the waning hours of Friday’s trading session in Frankfurt.
Elsewhere, Reuters reported on Friday that Volkswagen’s board is currently discussing plans for two new factories in North America for battery and vehicle production. At least one factory will be based in the United States, according to the report.
Read more on why RBC says Stellantis is the top European auto stock.
Now read: Buy Porsche Holding Instead Of Porsche AG Directly