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Scania reports net profit loss after demand drop

Swedish truck maker Scania reported on Wednesday a one-third plunge in net profit for 2012 and a cut in current production, but said that orders had risen in the fourth quarter.

Scania reports net profit loss after demand drop

Scania is a leading supplier of trucks for road transportation on international markets and the state of demand for heavy trucks is a barometer of overall economic activity.

Scania said that net profit had fallen by 30 percent last year from the 2011 level to 6.64 billion kronor ($1.0 billion).

Profit in the fourth quarter fell by 11.0 percent on a 12-month basis to 1.89 billion kronor. The average expectation of analysts polled by Dow Jones Newswires was 1.76 billion kronor.

For the whole of 2012, orders taken fell by 6.0 percent to 71,945 vehicles.

Chief executive Martin Lundstedt said in a statement:

“Given low demand for vehicles in Europe and the Middle East, the daily production rate is reduced by about fifteen percent in Europe in the beginning of the first quarter of 2013 compared to the end of 2012. A total of about 700 personnel on hire have been affected.”

But he said he saw good opportunities for growth, and the company would expand its sales and services organisation in emerging markets.

Commenting on the fourth-quarter rise in orders, he said this was driven by orders from Latin America,and particularly Brazil where subsidies had been a help.

“Order bookings in Europe remained at a low level. Customers are hesitant about investing in new vehicles in view of the uncertain economic climate,” he said.

He said that orders from Russia were strong but that orders from the Asia region fell mainly because of conditions on markets in the Middle East.”

The price of shares in the company was showing a fall of 0.94 percent at midday in an overall Stockholm market which was up 0.45 percent.

AFP/The Local/og

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MIGROS

Leading Swiss retailer axes 290 jobs

Migros, the biggest retailer in Switzerland, has announced it will cut 290 full-time jobs over the next three years following a drop in profit.

Leading Swiss retailer axes 290 jobs
teamtime/Depositphotos

The federation of cooperatives said in a statement it was making itself fit for the future and hoped to save 120 million francs through a restructuring of operations.

The majority of jobs will be lost through natural wastage and early retirement and reduced working hours but around 70 redundancies are expected, the retail giant said. 

The Migros cooperative currently employs 2,700 workers.

The business magazine Handelszeitung said most of the job cuts would hit marketing and IT departments.

It said Migros would be looking to reduce overcapacity and increase efficiency.

Profits at Migros were down 40 percent in 2017 despite the company posting record turnover.

The number one retailer in Switzerland ahead of Coop said the restructuring was less about cutting costs than about making funds available for future projects.

It also comes in response to the trend towards internet shopping and increased competition from international online retail businesses.

Migros was recently named most sustainable retailer in the world in a comparison of more than 150 companies, it reported earlier this month.