Daimler AG on Thursday (9 February) said group operating EBIT rose 24% year on year in 2011 to a record EUR8.98bn. Net profit was also a record – EUR6.023bn, compared with EUR4.67bn in 2010, while earnings per share was EUR5.32 versus EUR4.28. Group sales increased 9% to EUR106.5bn.
A Bloomberg News survey of 23 analysts on Wednesday had suggested Daimler would book EBIT up 24% to EUR8.8bn on revenue of EUR105bn.
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Mercedes-Benz Cars set new records for sales, revenue and EBIT with Daimler crowing: “In its long corporate history, the car division has never performed better than in 2011.”
“This performance shows that with its strong portfolio of cars, trucks, vans, buses and financial services, the group is strategically very well positioned. We are now putting all of our efforts into continuing this success and achieving our targeted rates of return on a sustained basis as of the year 2013,” said chairman and M-B Cars chief Dieter Zetsche.
Daimler said the 2011 profit was due largely to strong unit sales in all divisions. Mercedes-Benz Cars and Vans and Daimler Trucks “significantly increased” volume in major regional markets and Daimler Financial Services profited from the lower cost of risk.
The group booked EUR80m for effects of the March Japan earthquake/tsunami after insurance payments. Other one-off charges were related to equity interests in Renault (EUR110m) and Kamaz (EUR32m).
Daimler said it boosted unit sales 11% to 2.1m vehicles in 2011.
All this means a healthy bonus for workers: in Germany each will receive EUR4,100 (EUR3,150 a year ago) at the end of April.
Shareholder dividend will be about 40% of the net profit which works out at EUR2.20 per share (2010: EUR1.85) or EUR2.34bn (EUR1.97bn) in total.
The “Road to Emission-free Mobility” initiative, focused on new, extremely fuel-efficient and environmentally friendly drive technologies across all automotive divisions, led to a 2011 increased in research and development expenditure to EUR5.6bn from EUR4.8bn in 2010.
Mercedes-Benz Cars, including Maybach and Smart, sold a record 1,381,400 vehicles in 2011 (2010: 1,276,800) for revenue up 7% to a record EUR57.4bn.
EBIT rose to EUR5.2bn from EUR4.6bn and operating margin was 9.0% versus 8.7%.
Daimler Trucks increased sales and revenue 20% to 425,800 vehicles and EUR28.8bn. EBIT rose to EUR1.88bn from EUR1.33bn and margin was 6.5% (5.5%).
Mercedes-Benz Vans unit sales rose 18% to 264,200 units and revenue of EUR9.2bn compared with EUR7.8bn in 2010. EBIT was EUR835m versus EUR451m and margin improved from 5.8% to 9.1%.
Daimler Buses unit sales of buses and bus chassis, despite difficult conditions for complete buses, rose slightly to 39,700 from 39,100 but revenue dipped to EUR4.4bn from EUR4.6bn leading to EBIT down to EUR162m from EUR215m and margin off at 3.7% versus 4.7%.
“This earnings development is due to lower unit sales of complete buses in western Europe and North America, especially in the city-bus segment, in which demand decreased. Higher prices due to the influence of inflation in Latin America also had a negative impact on EBIT. The division’s earnings were positively affected by higher shipments of bus chassis in Latin America (including Mexico) and by exchange-rate effects,” Daimler said.
Daimler Financial Services worldwide contract volume grew 13% to a record EUR71.7bn (2010: EUR63.7bn). New business rose 15% to EUR33.5bn due to higher unit sales at the automotive divisions. EBIT rose to EUR1.3bn from EUR831m and return on equity was 25.5% versus 16.1% due to lower provisions for risks, improved refinancing conditions and the increased contract volume. Earnings were, however, affected by costs related to a restructure in Germany and additional allowances for bad debts due to the Japan earthquake.
Outlook
Daimler expects growth in 2012 everywhere except in western Europe markets, which is increasingly affected by the [eurozone] debt crisis.
“Global registrations of new cars are likely to increase by approximately 4%, whereby the growth will primarily be driven by the Asian emerging markets, the US market and the Japanese market, which will benefit from catch-up effects,” Daimler said.
The automaker sees demand for medium and heavy trucks “at least at the level of last year”.
“Despite a perceptible growth slowdown, the North American market should prove to be the world’s most important driver of demand, expanding by 15 to 20%. Demand for trucks in Europe will be impacted by the ongoing sovereign-debt crisis and the resulting economic weakness. So at best, demand in that market can only be expected to be about as strong as last year. The Japanese market for heavy and medium-duty trucks should expand once again by 5 to 10% compared with the prior year, thanks to the country’s economic growth, which is benefiting from the reconstruction efforts. Overall demand for trucks in the emerging markets should grow only moderately this year.”
Mercedes-Benz Cars sales are expected to grow faster than the total market thanks partly to new models either just launched or due out later in 2012 as well as a new line of more fuel efficient engines.
“In regional terms, Mercedes-Benz Cars sees further growth opportunities in 2012 above all in North America, as well as in China, India and Russia. Prospects in Western Europe are rather limited, however,” Daimler said.
Group EBIT for 2012 is expected to match 2011 and Daimler is aiming for automotive business margin of 9%.
It also expects to create new jobs this year in North America, Asia and Hungary saying, a little ominously: “By developing production capacities abroad, the jobs in Germany are being secured for the long term.”
