Volkswagen, the biggest European carmaker, said Friday that 2009 profit plunged by nearly 80 percent in the global slump but predicted that sales and operating profit would rebound this year.
VW reported a 79.8 percent drop in net profit to 960 million euros (1.3 billion dollars) on sales that fell by 7.6 percent to 105.2 billion euros.
Analysts polled by Dow Jones Newswires had forecast net profit of 986 million euros, and the news sent VW shares sharply lower in late trading on the Frankfurt stock exchange.
“Revenue and operating profit for 2010 are expected to exceed the prior-year figures” however, the company said in a statement following a supervisory board meeting.
But volatility in interest and exchange rates would continue to dog the net profit figure, it added.
Although VW sales collapsed last year, the group still benefited from auto scrapping schemes that favoured smaller cars and from a strong presence in China, which is now the auto maker’s biggest market, and in Brazil.
Operating profit nonetheless plummeted to 1.9 billion euros, a drop of 70.7 percent.
The group said it would propose a dividend payment of 1.60 euros per ordinary share, down from 1.93 euros in 2008, and release details of fourth quarter earnings on March 11.
Shares in the group fell by 1.09 percent to 59.92 euros in Frankfurt trading, while the DAX index was 1.24 percent higher overall.
VW is expected to carry out a rights issue to underpin its bid to overtake Toyota as the world’s biggest automaker by 2018 and possibly help reduce debt at Porsche, the luxury sports car maker it took over last year.
Details of the rights issue are awaited in the coming weeks and will likely focus on preferred shares, which have no voting rights.
An increase in ordinary shares would affect the holding of Lower Saxony, the German state where VW is based and which owns 21 percent of those shares, giving it a blocking minority position on strategic decisions.
Dow Jones Newswires quoted Sanford Bernstein analyst Max Warburton as saying that “Lower Saxony and the labour unions have no direct concern for the price or numbers of VW preference share and so are probably content to let institutional investors pay the bill.”
