Volkswagen Financial Services AG raised its earnings forecast for the financial year 2017 after its first-half operating result exceeded €1 billion for the first time.
The company, which originally estimated its 2017 operating result to amount to at least €1.9 billion, now expects the figure to at least match the 2016 result of €2.1 billion, it said Aug. 2.
The operating result for the first half went up by 17% year over year and reached €1.2 billion thanks to the positive development of Volkswagen Financial Services' contract portfolio and the lower level of refinancing costs compared with 2016, CFO Frank Fiedler said.
The current portfolio of the company grew 8.2% year over year, exceeding 18.8 million contracts at the end of June. New contract acquisitions increased 2.1% globally to more than 3.8 million, with high increases in new business achieved particularly in China, Mexico and southern Europe.
New contracts in the vehicle financing segment, new leasing contracts and new service contracts expanded by 4.4%, 4.7% and 6.7% year over year, respectively. New insurance contracts fell by 5.2% compared with the first half of 2016, which saw above-average growth in this segment, the company noted.