Volkswagen today announced first-quarter operating profit rose by 55 per cent to €726 million, falling under analysts' forecasts.
VW stuck to its forecast that group operating profit before special items would rise in 2006 but was not more specific.
Cash flow from operating activity at the core automotive business advanced to €3.02 billion from €708 million in the year-earlier period.
The car maker said in March there would be special items this year that it cannot as yet quantify, both due to one-off costs from streamlining its loss-making German VW operations as well as gains such as from selling its rental car agency Europcar.
Although unfavourable exchange rates, stiff competition from Asian rivals, and margin-eroding incentives amid sluggish global auto markets are all causing enough headaches for Volkswagen, the car maker's biggest burden remains the exorbitant cost base at its six main western German VW plants.
The stock trades at 15.2 times estimated 2006 earnings, according to estimates, a significant premium to French car makers Renault and Peugeot but lags fellow restructuring story Fiat, which trades at 21.3 times earnings.