MILAN (Reuters) -Italy’s Iveco said on Tuesday the negative effects of supply chain disruptions would peak this quarter after its operating profit topped estimates in the first three months of the year thanks to light commercial vehicle and bus performance.
In its first set of results as a stand-alone company, the truckmaker posted adjusted earnings before interest and tax (EBIT) of industrial activities of 82 million euros ($88 million) in the January-March period.
That was lower than a 116 million euro pro-forma result one year earlier, when the company was still part of CNH Industrial, but exceeded an analyst consensus of 37 million euros reported by Intesa Sanpaolo.
Milan-listed shares in Iveco turned positive after results were published to gain 5.3% by 1320 GMT.
“Results were far less bad than we expected,” a Milan-based trader said.
First quarter revenues of industrial activities also topped analyst consensus.
Iveco’s operations Russia and Ukraine, which were suspended during the first quarter, do not constitute a material portion of its business, it said in a statement.
SUPPLY CHAIN
The company said global supply chain issues continued to represent the main challenge for its operations for this year, including raw material price increases and parts availability, semiconductors in particular.
Chief Executive Gerrit Marx said that, as the company approached the second quarter, “we foresee the most severe impacts from component shortages for the entire year”.
Iveco Group, which completed the spin-off from former parent CNH Industrial at the beginning of January, said that, based on current visibility, it forecast its full-year consolidated adjusted EBIT to range between 350-370 million euros, versus a 102 million euro result in the first quarter.
($1 = 0.9369 euros)
(Reporting by Giulio Piovaccari, additional reporting by Claudia Cristoferi, editing by Cristina Carlevaro and David Evans)
