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VW returned to profit with $5.4B in 2016

  • COURTESY PIXABAY

    The company reported a net profit attributable to Volkswagen AG shareholders of 5.1 billion euros ($5.4 billion) last year compared with a net loss of almost 1.6 billion euros in 2015.

BERLIN >> Volkswagen bounced back into the black in 2016 after suffering a loss the previous year due to the diesel emissions scandal, according to figures released Friday by the German automaker.

The company reported a net profit attributable to Volkswagen AG shareholders of 5.1 billion euros ($5.4 billion) last year compared with a net loss of almost 1.6 billion euros in 2015.

Volkswagen acknowledged in September 2015 that it had been installing engine control software in diesel vehicles to detect when cars were being tested. The software turned the emission controls off during normal driving to improve performance but also resulted in releasing emissions more than 40 times the U.S. limit for the pollutant nitrogen oxide.

The Wolfsburg-based company paid a heavy price for its deceit, agreeing to pay more than $16 billion in buybacks and compensations to owners of VW cars in the U.S. alone. Lawsuits and legal investigations in several other countries are also ongoing.

Separately, Volkswagen announced a clampdown on executive bonuses. The company said annual pay for its CEO will in the future be capped at 10 million euros ($10.6 million), while other executive board members will receive a maximum of 5.5 million euros ($5.8 million) in one year.

Rise in new-home sales a positive sign

WASHINGTON >> Americans bought more new homes in January after a steep fall-off the previous month, a sign the housing market is healthy despite higher mortgage rates.

New home sales rose 3.7 percent to a seasonally adjusted 555,000, the Commerce Department said Friday. That’s 5.5 percent higher than a year ago.

Solid job gains and some signs of rising wages have driven up consumer confidence, which also has risen since the presidential election. More confident consumers are more likely to buy homes. Sales of existing homes jumped to their highest level in a decade, according to data released earlier this week.

The solid sales have occurred despite, or perhaps because of, a jump in mortgage rates since the fall. Many buyers could be accelerating purchases to get ahead of any further rate increases.

J.C. Penney reports fourth-quarter profits

PLANO, Texas >> J.C. Penney Co. on Friday reported fiscal fourth-quarter net income of $192 million, after reporting a loss in the same period a year earlier.

The Plano, Texas-based company said it had profit of 61 cents a share. Earnings, adjusted for one-time gains and costs, came to 64 cents a share.

The results exceeded Wall Street expectations. The average estimate of 13 analysts surveyed by Zacks Investment Research was for earnings of 61 cents per share.

The department store operator posted revenue of $3.96 billion in the period. Eight analysts surveyed by Zacks expected $3.97 billion.

Penney shares have declined 17 percent since the beginning of the year. The stock has decreased 9 percent in the last 12 months.

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