WOLFSBURG (dpa-AFX) - The Volkswagen Group performed better than feared in the second quarter in view of the problems at its major brands. Although the operating result did not fall as significantly as expected, the development of the Group's mass brands was not well received by investors. Volkswagen Group CEO Oliver Blume announced that following the cost-cutting measures introduced for jobs and plant capacities, the Wolfsburg-based company was now focusing on "costs, costs, costs", and not just for the low-profit core brand VW Passenger Cars. In a weaker industry environment, this did not provide any relief on the stock market, with the DAX-listed preference share falling.

The share fell by 1.7 percent to 101.45 euros on Thursday. Over the course of the year, the share price fell by more than 9 percent. VW's operating result is somewhat better than expected, wrote Goldman Sachs analyst George Galliers. However, negative price and mix effects in the mass brands of the Core brand group - i.e. VW Passenger Cars, Seat/Cupra, Skoda and the light VW commercial vehicles (VWN) - had caused the operating result to slip significantly below expectations, according to the expert. The Group subsidiaries Audi and Porsche AG had already presented their figures.

The operating result in the Group shrank by 2.4 percent to 5.46 billion euros, as the DAX-listed company announced. Analysts had expected a larger decline on average. Despite lower sales in the second quarter, turnover rose by 4.1 percent to 83.3 billion euros thanks to the development in the financial division. However, profit fell by 4.2 percent to 3.63 billion euros.

In addition to the declines in day-to-day business at the important profit drivers Porsche and Audi, the costs of job cuts at the core brand VW Passenger Cars cost the Group dearly. As already announced, VW has set aside 0.9 billion euros for this purpose.

Special expenses of around 1.7 billion euros - including 1.3 billion euros for the possible closure of the Audi plant in Brussels - are expected to follow in the current third quarter. Due to these charges, the Wolfsburg-based company lowered its earnings forecast for the full year at the beginning of July. The management headed by Oliver Blume has now confirmed this outlook. The sports car manufacturer Porsche is currently struggling with sales difficulties in China and recently also lowered its forecast for the year due to problems with the supply of aluminum parts.

In a telephone conference, Blume confirmed that expenditure on capital expenditure and research and development is set to fall in the coming years from its peak this year. As battery cell production ramps up, he sees scope to adjust the timing of expensive investments in the plants to demand and circumstances. VW can also act flexibly with regard to the ratio between in-house production and external sourcing of batteries./men/fjo/nas/ngu