Quarterly results show global sales declined for equipment maker.
Sweden-based Volvo Construction Equipment (Volvo CE) says its 2013 third quarter was marked by declining sales compared to the third quarter of 2012.
Volvo CE has cited weak demand, especially in the mining sector, and unfavorable currency developments as negative factors in its most recently completed quarter. Despite those challenges, the company says it “showed good operating margin in Q3 (4 percent), thanks to effective cost control and inventory management.”
In a news release stating there is “no clear sign of a global recovery in the sector in sight,” Volvo CE saw its third quarter sales decline 7 percent compared to the same period in 2012. “Sales were negatively impacted by lower activities in the global mining industry, which particularly hit sales of larger and more expensive products,” says the company.
“While there is still no clear sign of a global market recovery in the construction equipment sector, we did see an uptick in China, driven by sales of smaller equipment, and a slight increase in the European market,” says Pat Olney, president of Volvo CE. “Our base scenario for 2014 is that the markets will remain at largely the same level as we have seen in 2013.”
For 2013, Volvo CE forecasts its European market to be down by 5 to 15 percent (measured in units) while North America, South America, Asia (excluding China) and China itself are all expected to be in the range of minus 5 percent to plus 5 percent.