Swedish truck maker AB Volvo said on Jan. 8 that it had returned to profitability in 2002 after a large loss the previous year, but warned that the road ahead was still likely to be rocky.
Volvo's net profit for 2002 was 1.4 billion kroner (151 million euros), compared with a loss of a roughly similar size - 1.46 billion kroner - in 2001.
The result was ahead of expectations from financial market analysts, who had been looking for a profit of up to 1.2 billion kroner.
Volvo said its fourth-quarter pretax profit of 727 million kroner, up from 547 million a year earlier, was boosted by increased truck deliveries in most markets and by the company's increased focus on cash flow management.
But Volvo's executives immediately dampened any unwarranted euphoria, predicting that global economic weakness would squeeze earnings this year.
"Our major concern is the world economic uncertainty. We do not expect a major recovery in North America during the first part of 2003, and Europe is likely to face a continued but not dramatic downturn." said Leif Johansson, Volvo's chief executive.
Volvo has only just emerged from a period of convalescence following the integration of its Renault Trucks and Mack Trucks units, which was the main factor behind a 3.8 billion kroner restructuring charge that led to 2001's massive loss.
Volvo said it booked no restructuring charges at all in 2002.