Swedish manufacturer Volvo has posted financial results for the first half of 2012 while announcing details of its loan agreement with China Development Bank.
Earnings before interest and tax (EBIT) stood at 239m Swedish krona (£194.8m) for the first six months of 2012, less than a sixth of the 1.53bn Swedish krona recorded for the first six months of 2011. Revenue, however, over the period increased 3.9% to 65.3bn Swedish krona.
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Volvo said, in a statement, the maintenance of a positive EBIT was the result of "protecting margins, staying prudent and not fully participating in incentive wars in some markets".
Total global car sales for H1 2012 stood at 221,309 units, rising to 421,951 for the whole of the year. Total new registrations in the UK were 31,743 according to the brand and 31,790 according to final year figures from the Society of Motor Manufacturers and Traders.
Having signed a loan agreement with Volvo Cars at the end of 2012, China Development Bank will now also evaluate the financing of its global business plan, in conjunction with the manufacturer. The first step of the plan is a 922m (£752m) loan to Volvo Cars to finance its current loans.
richard.brown@timetric.com
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