MAN SE FRANKFURT (Reuters) - Germany's MAN SE (>> Man SE) said on Tuesday its first-quarter operating profit fell 50 percent as a recovery in Europa was not enough to offset an ongoing decline in Brazil.
Operating profit at MAN, owned by Volkswagen (>> Volkswagen AG), fell to 34 million euros (24 million pounds) from 68 million a year earlier, the Munich-based truck manufacturer said.
Brazil's stalling economy and the weak real have weighed on the market in a country where MAN is the top-seller. The VW unit has been the local leader in the segment over 5 metric tons for 11 years and is a key supplier of commercial vehicles and bus chassis.
"There are no signs of a recovery yet in Brazil and the situation there remains strained with direct consequences for our business activities in South America," MAN Chief Executive Georg Pachta-Reyhofen said in the company's quarterly report.
"Our financial figures for the first quarter reflect these developments."
Europe showed recovery, but Eastern Europe was "badly affected" by the Ukraine conflict, MAN said.
MAN, which also makes diesel engines and turbines, said last month it would expand cost reductions at its core truck division to all business areas as parent VW steps up its efforts to forge a global force in trucks.
The group said it still expects 2015 sales revenue on a level with the previous year and stable operating profit.
MAN shares were indicated to open 0.3 percent lower, according to pre-market data from brokerage Lang & Schwarz at 0630 GMT, in line with the German blue chip <.GDAXI>.
(Reporting by Harro Ten Wolde and Andreas Cremer; Editing by Maria Sheahan)
