* 2014 group sales to fall slightly below yr-ago level
* 2014 truck and bus sales to be flat
* CEO "cautiously optimistic" on 2014 business
* Aims to more than triple truck-division profit
(Adds goal to boost truck-division profit, executive comment)
By Andreas Cremer
MUNICH, March 12 Germany's MAN SE aims
to more than triple profits from its truck business in the
medium term partly through cost-cuts after the group as a whole
reported a sharp fall in 2013 earnings.
MAN's truck & bus division, which accounts for half of the
company's profits, is looking to boost operating earnings to
more than 800 million euros per year in the mid-term, from 228
million in 2013.
Trucks chief Anders Nielsen said this would come from cost
cuts and improved resource management as a result of MAN being
part of Volkswagen. He declined to be more specific
on the plans.
"We need to improve profitability to fund future growth,"
Nielsen said on Wednesday, ruling out job cuts. "There's some
homework for us to do."
MAN is struggling to boost profitability at its trucks
division, which is heavily dependent on volatile European
markets, is grappling with high product costs and has limited
ranges for lucrative premium truck markets in Latin America.
VW is trying to align MAN with Sweden's Scania,
also VW-owned, to take on Daimler, the world's
VW has spent billions of euros over more than a decade on
expanding its stakes in MAN and Scania. Last month, VW revealed
plans to buy out Scania minority shareholders for 6.7 billion
euros to jump start stalled efforts to bring about the alliance.
MAN, which also makes diesel engines and turbines, said 2013
operating profit dropped to 475 million euros from 969 million a
year earlier, slightly above the lowest estimate of 454 million
euros in a Reuters poll of analysts.
Profit last year was reduced by 286 million euros ($396.58
million) because of provisions at the group's power engineering
division related to problems at a project to build
diesel-fuelled electricity plants.
MAN expects to post a "distinctly higher" operating profit
this year than in 2013. "We're now looking ahead," Chief
Executive Georg Pachta-Reyhofen said. "I'm cautiously optimistic
MAN expects 2014 deliveries to be flat after companies
rushed to buy older but cheaper models in the second half of
2013 ahead of a January change in emission rules.
Group sales including gains from diesel engine and turbine
sales may dip slightly below the 15.7 billion euros posted in
2013, it said.
Operating profit at the power-engineering division, which
accounts for a quarter of group sales, is likely to improve
sharply from last year's 40 million euros, MAN said.
($1 = 0.7212 euros)
(Reporting by Andreas Cremer; Editing by Mark Potter and Jane