Although BMW has posted a strong set of first quarter financial results, the company has acknowledged they would have been better but for ‘volatile conditions and unfavourable foreign exchange rate effects’ (mainly the weaker dollar) and the need for higher investment for ‘tomorrow’s mobility’.
“Our industry is currently going through a phase of unprecedented technological change and must master the highly challenging conditions. The first quarter highlights some important points: we think in terms of opportunities and are pursuing a well-defined strategy; we are combining tomorrow’s mobility with sustainable profitability – underlined by the fact that we are capable of generating a high pre-tax margin on group level, even in volatile times,” said Harald Krüger, Chairman of the Board of Management of BMW AG, in Munich.
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“The BMW Group was the world’s most profitable car company in 2017 and is stepping up the pace again in 2018. In the opening quarter of the new year, we achieved new best-ever figures for sales volume and net profit and implemented some crucial strategic decisions,” Krüger said.
Analysts were generally pleased with BMW’s Q1 results.
Revenues fell 5.1% to EUR22.7bn in the quarter, dragged down by currency effects – without which they would have been just 0.7% down on last year.
First-quarter deliveries of BMW, MINI and Rolls-Royce brand vehicles rose by 3.0% to 604,629 units (2017: 587,237). All three major sales regions contributed to the increase. Due to currency effects, group revenues for the three-month period fell by 5.1% to EUR22,694m (2017: EUR23,926m). Adjusted for currency effects, revenues were at a similar level to the previous year (-0.7%). Profit before financial result (EBIT) was also influenced by currency factors and came in at EUR2,733m (2017: EUR2,821m / -3.1%). Group profit before tax (EBT), which is relevant for the BMW Group financial guidance, amounted to EUR3,165m (2017: EUR3,180 million / -0.5%) and reached the previous year’s high level ‘despite rising costs and upfront expenditure for R&D activities’.
