Daimler is expected to post strong Q2 financial results due next week (July 27), with its truck unit leading the way, according to an analyst who spoke to just-auto.
Creative Global Investments analyst Sabine Blümel said that she expects a second quarter 12.1% yoy increase in group revenue to EUR 28.10bn which will result in a 14.8% yoy increase in group EBIT (ongoing business) to EUR 2.49bn.
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“We expect that Daimler Trucks spearheaded the year-on-year improvement of EUR 0.32bn at group level with an EUR0.24bn contribution,” she said.
Blümel’s upbeat assessment is based on continuing sharp profit and margin improvement for Daimler Trucks as well as an accelerating recovery in global truck demand.
“The the fastest growing markets for Daimler Trucks continued to be NAFTA and US, where we expect the division gained market share, Turkey, China and Western Europe outside Germany. Our estimate is supported by a sharp increase in first quarter incoming orders of 65% over last year,” she said.
At 118,900 units, orders exceeded sales by 33% according to Blümel’s analysis. “This points towards a sharp acceleration in business beyond the second quarter, especially in the US and NAFTA, where orders exceeded sales by two thirds,” Blümel added.
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By GlobalDataWhile the Mercedes car division is also expected to show a healthy result for the second quarter, its performance has been less stellar in the face of factors including higher R&D costs, rising raw materials and labour costs.
M-B Cars reported a 7.2% year-on-year increase in second quarter retail sales to 359,800 units, a historic record. Blümel expects the unit to post a second quarter 8% y-o-y increase in revenue generated an EBIT of 1.45bn and a 9.6% margin (versus 9.8% in the same quarter last year).
For the 2011-2013 period, Blümel forecasts earnings growth of 20.4% p.a. for Daimler on the back of sales of annual growth in sales of more than 11%.
Again, the truck division is expected to be strong due to the combination of strong sales and lower costs on restructuring efforts. “DT [Daimler Trucks] also protects group earnings in an environment of growing currency fluctuations, because of its higher natural hedge compared to the Mercedes-Benz Cars unit,” Blümel points out.
