Daimler Profit Beats Forecasts on E-Class Model Sales -- Update
October 21 2016 - 3:06AM
Dow Jones News
By William Boston
BERLIN-- Daimler AG, the German luxury car maker, Friday
reported sharply higher profit in the three months to the end of
September, driven by strong sales of its new E-class models,
sport-utility vehicles and positive currency effects.
Daimler's results beat analyst estimates, driven higher by
strong profit growth at Mercedes-Benz Cars, Mercedes-Benz Vans and
Daimler Financial Services and despite a sharp decline in earnings
at Daimler Trucks.
Mercedes-Benz Cars, the company's biggest division, saw strong
demand for its luxury sedans in China, pushing sales higher and
keeping Daimler on track to overtake rival BMW AG. The growth comes
even as Daimler is investing heavily in new technology for electric
vehicles and self-driving cars and despite a growing slump in its
trucks business.
Net profit in third quarter was EUR2.60 billion ($2.83 billion),
up from EUR2.39 billion the year before, while earnings before
interest and taxes after special items, or EBIT, rose 10% to EUR4
billion. Revenue rose 4% to EUR38.6 billion.
Daimler confirmed its outlook for the full year, saying it
expected to achieve revenue at about the same level as last year,
with growth in Western Europe and Asia, but declining in North
America as the U.S. market slows down.
"Daimler remains on track to achieve our earnings forecasts for
the full year, despite volatile sales and finance markets," said
chief finance officer Bodo Uebber.
The company expects EBIT to "increase slightly" in 2016, despite
sharply lower earnings in the struggling truck division.
Revenue at Mercedes-Benz Cars rose 12% to EUR23.3 billion in the
third quarter, and EBIT rose 23% to EUR2.7 billion, driven higher
by "growing unit sales in the SUV segment and the market success of
the E-class," the company said.
Daimler Trucks, which issued a profit warning in May and has
warned of job cuts, suffered a 19% decline in revenue to EUR7.8
billion in the three months to the end of September. Revenue was
hit by continued economic troubles in emerging markets, falling
demand in the U.S., Turkey and the Middle East, and "intense
competition" in Europe.
Write to William Boston at william.boston@wsj.com
(END) Dow Jones Newswires
October 21, 2016 02:51 ET (06:51 GMT)
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