Volkswagen, the German automotive giant, reported a 15% drop in annual operating profit on Tuesday. This decline was attributed to escalating costs and "extraordinary expenses" linked to its ongoing restructuring strategy. Despite these challenges, Volkswagen remains optimistic, projecting a potential sales revenue increase of up to 5% by 2025. The automaker also forecasts its operating margin to rise between 5.5% and 6.5% during the same period.
The company recorded a revenue of 324.7 billion euros ($352.8 billion) for the full year of 2024, marking an increase from the previous year's 322.3 billion euros. However, vehicle sales dropped by 3.5% throughout the year. Volkswagen described these results as "solid" given the challenging environment it faced, which included increased operational costs and significant expenses related to its restructuring efforts.
Volkswagen's operating margin for 2024 stood at 5.9%, aligning with its projected range for 2025. As part of its financial strategy, the company plans to propose a dividend of 6.30 euros per ordinary share and 6.36 euros per preferred share at its annual general meeting in May. Notably, this proposed dividend reflects a 30% reduction from the previous year, highlighting the impact of financial constraints arising from its restructuring activities.
Looking forward, Volkswagen is hopeful that its strategic adjustments will pave the way for increased revenue and improved profitability in 2025. The company aims to surpass the previous year's revenue figures by up to 5%, banking on enhanced operational efficiency and market demand recovery.