Audi Group in H1 2020: Effects of COVID-19 pandemic still very significant

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  • Deliveries to customers: stabilization in the markets
  • Continuing along the electrification course: Audi e-Tron is world market leader for all-electric vehicles from German premium manufacturers
  • Audi Group: €20,476 million revenue, €643 million operating loss before special items, operating return on sales before special items of minus 3.1 per cent
  • The net cash flow of €1,953 million mainly due to sales of equity interests, investment discipline and inventory reduction
  • CFO Arno Antlitz: “We are starting the second half of the year with robust liquidity and are consistently implementing our product roadmap”
  • Outlook: Significant recovery expected in the second half of the year, but key financials for 2020 as a whole remain adversely affected by corona

Results of the first six months:

In the first half of this year, deliveries, revenue and operating profit were below the previous year’s figures. As expected, the consequences of the corona pandemic are presenting major challenges for the entire economy and for Audi as well.

The second quarter, in particular, featured an orderly restart of production and a significant recovery in customer demand.

A positive trend is evident in in-car deliveries:

At minus 22 percent, Audi is significantly better positioned than the market as a whole with minus 28 percent. As a result, the Audi Group’s revenue in the first half of 2020 totaled €20,476 million and its operating loss before special items was €643 million.

“The effects of the corona pandemic are also reflected in our key financial figures. We responded quickly to the corona pandemic and optimized our short-term expenditure without compromising our long-term product plans. We are starting the second half of the year with robust liquidity,” says Arno Antlitz, Member of the Board of Management of AUDI AG for Finance and Legal Affairs.

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A worldwide decline in demand and interruptions in the supply chain led to global production suspensions and short-time working at Audi’s German plants. All Audi plants have been producing again since end-June.

In the first half of the year, the Audi Group’s revenue fell to €20,476 million as a result of lower unit sales (2019: €28,761 million). The good revenue development of the all-electric Audi e-tron had a positive effect: By the middle of the year, 16,898 Audi e-tron cars had been delivered to customers (2019: 9,444).

This makes the Audi e-tron the global market leader among all-electric vehicles from German premium manufacturers. Since May 2020, the Four Rings also gradually launch the Audi e-tron Sportback.

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The markets present a mixed picture: In Europe (minus 29 percent) and in the USA (minus 22 percent) the deliveries of the Audi brand were still significantly negative in June. In China, a significant recovery in demand has been apparent since March.

The Four Rings achieved record figures there in May and June. Cumulative sales in our most important single market are still slightly down on the prior-year period, by 3 percent. Key growth drivers in China in the first half of the year were the new Audi A6 L, Audi Q2 L and Audi Q5 L.

In the first half of the year, the Audi Group’s revenue fell to €20,476 million as a result of lower unit sales (2019: €28,761 million). The good revenue development of the all-electric Audi e-tron had a positive effect: By the middle of the year, 16,898 Audi e-Tron cars had been delivered to customers (2019: 9,444).

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This makes the Audi e-Tron the global market leader among all-electric vehicles from German premium manufacturers. In May 2020, the Four Rings also gradually launched the Audi e-Tron Sportback.

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Against the backdrop of the difficult market situation caused by the pandemic, the operating loss was €750 million (2019: operating profit of €2,300 million) and the operating return on sales was minus 3.7 percent (2019: plus 8.0 percent).

Extensive measures on the cost side only partially offset the declining volume. The remeasurement of hedging transactions also had a negative impact on the development of earnings.

Adjusted for special items of €108 million in connection with the diesel issue, the operating loss amounted to €643 million (2019: operating profit of €2,300 million). The adjusted operating return on sales was minus 3.1 percent (2019: plus 8.0 percent). The sale of Autonomous Intelligent Driving GmbH within the Volkswagen Group had a positive effect on operating profit.

For the reporting period, the Audi Group’s profit before taxes amounted to €86 million (2019: €2,580 million). This includes financial income of €836 million (2019: €280 million). A major reason for the increase is the higher income from investments as a result of the intra-Group sale of Audi Electronics Venture GmbH.

Despite a difficult market environment, the Audi Group’s net cash flow and net liquidity remained strong: The net cash flow amounted to €1,953 million, especially against the background of the sales of a company (2019: €2,253 million).

Net liquidity remains at the high level of €19,875 million (end of December 2019: €21,754 million). In the context of the corona pandemic, Audi has set up a liquidity task force to systematically reduce cash outflows and help to secure Audi’s long-term ability to act.

All non-product-related costs and investments are systematically scrutinized. Thanks to its strengthened investment discipline, the Audi Group has achieved a ratio of capital expenditure to revenue of 2.4 percent (2019: 3.0 percent).

“Despite initial positive signals from the markets, the year 2020 remains extremely challenging. We are steering through the Corona crisis in a highly concentrated manner and with the necessary flexibility.

Although we have thoroughly reviewed our short-term expenditure in recent weeks, we are keeping a close eye on our long-term projects and are implementing them consistently,” says Arno Antlitz.

“Our strategic decisions define the agenda for the coming years. At the heart of this is the electrification and digitalization of our model range.” One example is Artemis. This new unit will accelerate the development of additional electric models.

In addition, Markus Duesmann, Chairman of the Board of Management of AUDI AG, is taking charge of software in the Volkswagen Group Board of Management as part of his responsibility for research and development, and will, therefore, manage the new Car. A software-Organization unit within the Volkswagen Group.

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For the year 2020 as a whole, the company assumes that demand in global car markets will be significantly lower against the backdrop of the ongoing corona pandemic. The Audi Group, therefore, expects deliveries of the Audi brand and revenue to be significantly lower than in 2019. The result of operations is also expected to be substantially down on the previous year, but clearly positive. Net cash flow is expected to be below the prior-year level.

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Audi Group in H1 2020: Effects of COVID-19 pandemic still very significant - Brand SpurAudi Group in H1 2020: Effects of COVID-19 pandemic still very significant - Brand Spur

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Latest News

Next Meats, Purveyor of the World’s First Plant-based Yakiniku Meats, Is Now in Singapore

The Tokyo-based startup makes its debut in the alt-protein hotspot of Singapore

 

  • Next Meats has collaborated with Aburi-EN to deliver two new meal sets
  • Made with soybean proteins, the Kalbi contains no chemical additives or animal ingredients


SINGAPORE - Media OutReach - 14 April 2021 - Next Meats, a purveyor of the world's first plant-based yakiniku meats, is making its debut in the alternative protein hotspot, Singapore! The Japanese alternative meat company has collaborated this time with popular Japanese restaurant Aburi-EN, which will offer two types of set meals using the NEXT Kalbi (boneless short rib) for the very first time. Made largely from soy proteins, the NEXT Kalbi contains double the amount of protein and half the fats than that of regular meat and even more, it does not contain any chemical additives or cholesterol due to its lack of animal ingredients. Now, Singaporeans can enjoy yakiniku without the guilt!


Audi Group in H1 2020: Effects of COVID-19 pandemic still very significant - Brand Spur

From left to right: Premium Kalbi Don Set and Stamina Teishouku Set

The two new menus available at Aburi-EN are the Kalbi Don Set (S$13.80) and the Stamina Teishoku (S$15.80) — which are available for a limited time only. Next Meats has specifically chosen to work with Aburi-EN as they are a Japanese grilled-meat specialist. The two menus are the culmination of many months of research and development, and they will also be Aburi-EN's first-ever plant-based dishes.


Audi Group in H1 2020: Effects of COVID-19 pandemic still very significant - Brand Spur

For the Kalbi Don Set, Next Meat's Kalbi is grilled and served atop a bowl of fragrant Japanese steamed rice. Equally indulgent, the Stamina Teishoku features the Kalbi stir-fried with cabbage along with egg imported from Okinawa. The meat is then served with fragrant Japanese steamed rice, salad, pickles and miso soup. For both dishes, the meats are glazed with a special homemade sauce that packs an irresistible umami punch.

Both the Kalbi Don Set and Stamina Teishoku will be available at all Aburi-EN stores from April to July 2021.

An advocate of sustainable food production and better food security

The NEXT Kalbi is one of Next Meats' innovative offerings, which includes other plant-based delicacies such as the NEXT burger and NEXT gyudon (beef bowl). The company champions the importance of saving the planet and humanity through reducing the emission of greenhouse gases (which is produced from meat consumption and animal agriculture) and utilizing biotechnology to combat protein deficiency.

Through extensive research and development, Next Meats has culminated the knowhow on using molecular binding to mould vegetable proteins from powder. Buoyed by state-of-the-art, proprietary technologies, the company has successfully created vegan substitutes that replicate the texture of real meat.

About Next Meats

Hailing from Tokyo, Next Meats is a food-tech venture company that specialises in the research and development of Japanese-style alternative meat products. Its journey of product development began in 2017, and the company was officially established in 2020. Its portfolio of products includes plant-based burger patties, gyudon and yakiniku meats.

Social Media for Next Meats

Facebook: /nextmeats.singapore

Instagram: @nextmeats_singapore

Hashtags: #nextmeats #nextmeats_sg #japaneseplantbased


About Aburi-EN

Aburi-EN is Singapore's leading Japanese Grill restaurant chain, best known for delicious high quality grilled donburi bowls. Signature dishes include the Premium Buta Don with grilled chestnut-fed pork, Wagyu Karubi Don, and the Wagyu Stamina Don, made using A4/A5 Miyazaki Wagyu, which has won Japan's "National Wagyu Award" for 3 consecutive years, among many others. The homemade sauces give the meats and dishes an extra umami-ness. Aburi-EN is also known for affordable highballs and Japanese sours, which pair perfectly with the Aburi dishes.

Social Media for Aburi-EN

Facebook: /aburiensg

Instagram: @aburien.sg

Hashtags: #aburiensg #aburiendonburi #aburienjapanesegrill

Outlets

- Isetan Scotts:

350 Orchard Rd, #01-K1 Shaw House, Singapore 238868

- Causeway Point

1 Woodlands Square, #02-09B Causeway Point, Singapore 738099

- Jem

50 Jurong Gateway Rd, #01-04 Jem, Singapore 608549

- Vivo City

1 Harbourfront Walk, #01-159/160 VivoCity, Singapore 098585

- Novena Square

238 Thomson Rd, #01-89/90, Singapore 307683

- Guoco Tower

1 Wallich St, #B2 - 09, Singapore 078884

- Orchard Central

181 Orchard Central, Central, #01-16 Orchard, 238896

- Suntec City

3 Temasek Blvd, #B1-121 Suntec City Mall, Singapore 038983

- Nex

23 Serangoon Central, #01-63/64/65 Nex, Singapore 556083

Operating Hours

11am – 10pm, Daily

Audi Group in H1 2020: Effects of COVID-19 pandemic still very significant - Brand Spur
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