Skoda Auto Posts Record Sales And Profit In 2009 Despite Financial Crisis

MILTON KEYNES, UNITED KINGDOM – March 26, 2010: Despite very difficult market conditions, Skoda Auto was one of the few car manufacturers to achieve record sales in 2009. Overall it supplied its customers with 684,226 cars, 1.4% more than in 2008.

Strong growth in the Chinese car market, where 122,556 cars were sold (up 106.7% year-on-year) was primarily behind the increase in deliveries. This was enhanced by a sales record on the German market, in which Škoda Auto, thanks to the government “scprappage program”, sold 162,328 cars ( +44.3%).

The best-selling models were the Octavia with 273,590 cars sold (+2.4%) and the Fabia with 264,173 units (+7.1%). The Superb posted the largest percentage increase in comparison with the previous year, with 44,548 cars sold, an increase of 73.7%. Sales of the first Škoda in the SUV segment – the Yeti – got off to a great start: from its introduction last September, until the end of the year a total of 11,018 Yetis were sold.

The financial results posted by the Škoda Auto group were significantly influenced by the continuing global economic and financial crisis and the resulting fall in total markets. The Group’s revenues reached CZK 187.9bn (around £6.6bn) and therefore fell by 6.2% in comparison with the previous year. The revenues were generated by cars (85.6%), original parts and accessories (8.1%), deliveries of parts to Volkswagen group companies (4.6%) and revenues on other goods and services (1.7%). The operating profit was CZK 5.9bn (-56.5%) and the profit before tax was CZK 4.7bn (-64.8%).

In terms of sales relevant to the operating profit (i.e. excluding deliveries to China), the figure fell in comparison with the previous year by 74,000 cars or 11.8%. The fall in the main financial indicators was, in addition to lower sales, also caused by a higher share of sales of small cars with lower margins, as well as measures implemented to support sales.

Despite the fall in results, the Group achieved an increase in operating cash flow of more than 100%. Net liquidity experienced a marked increase and, in comparison with 2008, rising by 52.4% to CZK 29.6 bn. Škoda’s investment totalled CZK 11.7 bn (-19.5%), most of which was centered on product investments (Škoda Yeti and Škoda Superb Combi).

Škoda Auto remains the most important exporter from the Czech Republic with approximately a 7% share in the country’s total exports.

“As expected, 2009 was even less favourable for Škoda Auto than the already problematic 2008,” said Holger Kintscher, the member of the Škoda Auto Board of Directors for Commercial Affairs.

“Unfavourable conditions in car markets, increased competitive and price pressure, particularly in Eastern Europe, and an overall decline in the markets relevant for us had a marked influence on the results. The CZK’s volatility was also a burden on us again.

“Thanks to thorough cost discipline and the “Scout” economy programme to improve the results, we remained markedly profitable. By achieving a high degree of liquidity, we managed to maintain our financial strength and stability.”

“Chairman of the Škoda Auto Board of Directors, Reinhard Jung, went on to say, “The Škoda brand managed to achieve a good result in the crisis year of 2009. Thanks to sales successes in Germany and China, we managed to achieve a further sales record.

“Škoda’s timely engagement in growth regions is now paying off. We further extended our foreign activities in 2009 by starting complete car production in Kaluga, Russia, and Pune, India. We strengthened our production programme even more in targeted fashion using the Škoda Yeti, Škoda Superb Combi and Škoda Octavia Greenline and LPG models.

“At the start of 2010 we comprehensively renewed our class of compact cars in the form of the Fabia and Roomster models. We were hereby responding to an increased demand for compact cars with low consumption. The Fabia RS, Fabia Combi RS and Fabia Scout models are new in the compact car programme. Škoda now has a very modern and attractive product range. This entitles us to look to 2010 with optimism.”