Audi 2007 Annual Report Download - page 162

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Around 180 Audi dealers are currently participating in the qualification program in Ger-
many, with the total expected to reach 400 by 2009. An additional 475 dealers in European
countries are expected to join by 2010. By the end of 2008, AUDI AG will have invested some
EUR 50 million in its comprehensive qualification program and thus in the efficiency of the
dealer network as well.
Financial performance
The Audi Group grew its revenue in fiscal 2007 by an impressive 7.9 percent to EUR 33,617
(31,142) million, the highest total ever in its lengthy history.
The Audi brand’s vehicle business played a significant role in the Company’s huge suc-
cess by generating revenue amounting to EUR 25,249 (23,404) million. The revenue mainstay
was the Audi A4 car line, which made very healthy progress over the year as a whole, de-
spite the changeover to the new sedan version in the second half. Revenue from sales of the
Audi A3, A6 and A8 models once again outpaced the previous year’s outstanding level, serv-
ing as tangible evidence of the high appeal of the brand with the four rings. The new Audi
A5 Coupé and the TT car line, including the new Audi TT Roadster that made its market
debut at the start of 2007, provided ample impetus for growth. The huge success of the Audi
R8 mid-engine sports car from the moment it was launched in April exceeded all expecta-
tions. Revenue from sales of the Audi Q7 once again rose impressively in the period under
review, making this vehicle a major source of growth for the Audi brand.
In addition to Audi-brand vehicles, the VOLKSWAGEN GROUP ITALIA S.P.A., Audi
Volkswagen Korea Ltd. and Audi Volkswagen Middle East FZE sales subsidiaries also sold
vehicles of the Bentley, SEAT, Škoda, VW Passenger Car and VW Commercial Vehicles
brands. The Company once again recorded an increase in revenue from the sale of vehicles
from other Volkswagen Group brands in fiscal 2007.
The cost of sales for the Audi Group rose by 4.3 percent in the period under review to
EUR 28,478 (27,309) million as a result of the higher sales volume. Further productivity gains,
improved processes and optimized material costs were the main reasons for the dispropor-
tionately low rise in cost of sales relative to revenue.
Overall, the Audi Group therefore enjoyed a notable increase in gross profit of 34.1 per-
cent to EUR 5,139 (3,833) million.
The 26.5 percent rise in distribution costs to EUR 2,737 (2,164) million and the 12.2 per-
cent rise in administrative expenses to EUR 266 (237) million were in large part attributable
to initial consolidation of the Audi of America, LLC and Audi Canada Inc. sales subsidiaries,
effective January 1, 2007. The other operating result was on a par with the previous year.
The Audi Group again improved its operating result by an impressive 34.2 percent in the
past fiscal year, in spite of a persistently unfavorable exchange rate. At EUR 2,705 (2,015)
million, the Company posted the highest result from operating activities in its history, a
fitting manifestation of its healthy, sustained growth.
The further improvement in net liquidity also boosted the interest income earned on the
latter and was consequently a major factor in the rise in the financial result to EUR 210 (– 69)
million.