Financial targets

The Volvo Group has in recent years gone through a substantial restructuring process in order to reduce structural costs and increase efficiency and is currently in a phase where focus is on organic growth and improved profitability through continuous improvement and innovation.

A clear and straightforward operating margin target supports the efforts to drive performance across the Group through the business cycle. The target also aligns with the way the Group and its business areas are challenged and measured internally. The?Board’s target is for the Group’s operating margin to exceed 10% measured over a business cycle.

A debt-free industrial balance sheet, excluding pension and lease liabilities, enables the Volvo Group to?better manage cyclicality in a capital-intensive industry and to secure competitive cost of funds for the Financial Services’ operation.


A diagram showing Volvo Group's operating margin

The Volvo Group’s operating margin shall exceed 10% measured over a business cycle. In 2019, the operating margin amounted to?11.5%. The adjusted operating margin amounted to 11.1% (10.4).

A diagram showing Volvo Group's net financial position

The Industrial Operations shall under normal conditions have no net financial indebtedness excluding provisions for post-employment benefits and lease liabilities. At the end of 2019, the Industrial Operations had a net cash position of SEK 62.6 billion.

A diagram showing Volvo Group's return equity

Financial Services’ target is a return on equity of 12–15% at an equity ratio above 8%. In?2019, return on equity amounted to 15.0% at an equity ratio of 8.0%.

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The Volvo Group Annual Report 2019

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