Daimler’s second quarter fiancial results due tomorrow (July 29) are expected to show signs of underlying improvement in spite of a big pre-tax loss of over EUR1.5bn and a large drop in revenue over last year.
Go deeper with GlobalData
The group is still being battered by continued weakness in its major markets, with the truck division bearing the brunt of the recession. However, Mercedes-Benz Cars (MBC) is expected to show improvement, helped by the recent introduction of the new E-Class.
According to a Dow Jones survey of analysts, Daimler’s earnings before interest and tax, or EBIT, is expected to show an EUR1.53 billion loss for Q2. Group revenue is seen down 20% compared with the same quarter last year at EUR20.2bn.
Daimler’s second-quarter earnings are expected to be hit by restructuring charges and the sale of its remaining 19.9% stake in Chrysler LLC to Cerberus. Analysts also expect a large chunk of the EUR260m overall restructuring charge at Daimler’s Japanese truck unit to be booked in the second quarter.
Sabine Blümel, an analyst with Creative Global Investments (LLC), told just-auto that she expects to see a considerably smaller expected loss at Mercedes-Benz Cars (MBC) this quarter over the previous one (EUR350m in Q2 against EUR1.12bn in Q1).
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Thank you!
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form
By GlobalData“We estimate that the roll-out of the E-Class was the main driver behind the expected improvement in results,” she said.
“There was a better model mix and also an absence of launch costs. We also estimate that during the second quarter, MBC was able to further reduce inventories to levels appropriate to current market conditions. This is in line with management guidance of April 28th, that the first quarter was the bottom of the curve.”
Blümel also said that she expects to see Daimler return to profit in 2010.
“MBC’s return to profitability should not be affected by the expiry of incentive programmes and trucks should benefit from restructuring as demand stabilises at low level,” she said.
Dave Leggett
