Rating agency Moody’s Investors Service (Moody’s) today upgraded its corporate credit rating for Volvo Cars to Ba2 from Ba3, with a stable outlook.
Moody’s said in its analysis: “The upgrade of Volvo Car’s ratings reflects the company’s strong operating performance over the past 12 months based on the successful introduction of the new XC90 and our expectation of further improvements in the company’s credit metrics driven by several new product launches, including the recently launched S90 and V90, over the next 2 years.”
Regarding the outlook, Moody’s stated: “The stable outlook is based on our expectation that the renewal programme and subsequent sales and earnings growth will lead to a further improvement in Volvo Car’s credit metrics, which will position it comfortably in the current rating category.”
Earlier this year, Volvo Cars successfully placed its first corporate bond, raising EUR 500 million. The proceeds from the bond issue were raised for general corporate purposes and aimed at increasing the company’s financial flexibility and diversifying its funding sources.
Volvo Car Group in 2015
For the 2015 financial year, Volvo Car Group recorded an operating profit of 6,620 MSEK (2,128 MSEK in 2014). Revenue over the period amounted to 164,043 MSEK (137,590 MSEK). For the full year 2015, global sales reached a record 503,127 cars, an increase of 8 per cent versus 2014. The record sales and operating profit cleared the way for Volvo Car Group to continue investing in its global transformation plan.
About Volvo Car Group
Volvo has been in operation since 1927. Today, Volvo Cars is one of the most well-known and respected car brands in the world with sales of 503,127 in 2015 in about 100 countries. Volvo Cars has been under the ownership of the Zhejiang Geely Holding (Geely Holding) of China since 2010. It formed part of the Swedish Volvo Group until 1999, when the company was bought by Ford Motor Company of the US. In 2010, Volvo Cars was acquired by Geely Holding.
As of December 2015, Volvo Cars had almost 29,000 employees worldwide. Volvo Cars head office, product development, marketing and administration functions are mainly located in Gothenburg, Sweden. Volvo Cars head office for China is located in Shanghai. The company’s main car production plants are located in Gothenburg (Sweden), Ghent (Belgium), Chengdu and Daqing (China), while engines are manufactured in Skövde (Sweden) and Zhangjiakou (China) and body components in Olofström (Sweden).