Financial targets until 2011


The Volvo Group's previous financial goals were established by the Board in September 2006. The Board focused on three goals comprising growth, operating margin and capital structure for the Group's Industrial Operations.

The growth target was that net sales should increase by a minimum of 10% annually. During 2007-2011, the average growth rate was 2.1% annually.

Operating margin
The Volvo Group’s profitability target was that operating margin for the Industrial operations was to exceed an average of 7% annually over a business cycle. The average annual operating margin for the Volvo Group's Industrial Operations was 4.1% from 2007 to 2011.

Capital structure
The capital structure target is set to a net debt including provisions for post-employment benefits for the Industrial operations of a maximum of 40% of shareholders’ equity under normal conditions. As of December 31, 2011, the Volvo Group's Industrial operations had a net financial debt position corresponding to 25.2% of shareholders’ equity.

Financial goals for Customer Finance Operations
The target for Customer Finance is a return on shareholders’ equity of 12-15% and an equity ratio above 8%. The average annual return on shareholders' equity for 2007-2011 amounted to 6%. At year end 2011 the equity ratio was 9.1%.