VW Profits Double in 1997
WOLFSBURG, Germany (AP) _ Volkswagen AG reported its earnings doubled in 1997 and said today it would go ahead with a share offering half as large as it had once planned.
Europe’s largest carmaker said its after-tax profit climbed to 1.36 billion marks, or $756 million, in 1997 from 678 million marks in 1996.
Revenue rose 13 percent to 113 billion marks, or $63 billion, from 100 billion marks a year earlier. It sold 4.25 million vehicles last year, up from 3.99 million a year earlier.
The earnings figures were released late Monday after a board meeting.
On Tuesday, spokesman Klaus Kocks said the board had decided to go ahead with issuing of 3 million new shares for current shareholders to raise about 3.5 billion marks, or $1.9 billion.
A planned second tranche of 3 million shares that were to be placed internationally was canceled, however.
VW has announced in September it planned to issue 6 million shares but its share price slumped and the company put the idea on hold in late October.
VW is expected to use the money to enter the truck market and to help in its efforts to become the world’s third-biggest carmaker, after General Motors Corp. and Ford Motor Co. The No. 3 spot is currently held by Toyota Motor Corp. VW is fourth with brands like Volkswagen, Skoda, SEAT and Audi.