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STOCKHOLM, Oct 24 (Reuters) - Sweden's AB Volvo , the world's second biggest truck maker, reported higher than expected third quarter profits on Thursday as the profitability of its key truck unit rose thanks to synergies.
Volvo had a pre-tax profit of 584 million crowns ($62.21 million) in the July-September period, rebounding from a 1.9 billion loss in 2001, beating consensus of 508 million crowns.
Its sales in the quarter inched up to 41.5 billion crowns from 41.1 billion a year earlier, below consensus of 44 billion.
"Most important is the increased contribution from the truck operations where we now see clear effects of synergies," Volvo Chief Executive Leif Johansson said.
In January 2001 Volvo bought the truck division of French Renault and Johansson said demand for both brands of trucks in Western Europe, a market that accounts for half of the company's sales, was strong.
"Both brands gained market shares and showed improved profitability," he said.
The news sent Volvo shares 2.1 percent higher to 143 crowns on a rising Stockholm market. Since the start of the year, Volvo shares have lost 19 percent and have underperformed the DJ Stoxx European automotive index by two percent.
Johansson said that in the United States, a market taking in 30 percent of sales, Volvo saw underlying improvements, even though its sales there eased in the third quarter.
At the start of last year Volvo bought the Mack truck maker in the United States and is selling trucks under both its own and the Mack brand.
Johansson said North American sales were underpinned by a one-off sales increase reflecting purchases brought forward because of strict new U.S. environmental regulations.
But the stricter law also slashed Volvo's order book by 12 percent and Mack's order book by 39 percent.
Volvo reported the biggest sales growth in Eastern Europe and Asia. However, they account for only four and seven percent of total sales respectively.