Daimler AG reports 10% increase in unit sales; First Quarter 2017 results
- Unit sales significantly above prior-year level at 754,300 vehicles (+10%)
- Revenue up by 11% to €38.8 billion
- Group EBIT is 87% above prior-year level at €4,008 million
- Net profit doubles to €2,801 million
- Free cash flow of the industrial business of €1.9 billion (Q1 2016: €0.3 billion)
- Significant growth in unit sales, revenue and Group EBIT anticipated for full-year 2017
- Dr. Dieter Zetsche, Chairman of the Board of Management of Daimler AG and Head of Mercedes-Benz Cars: “A very successful quarter lies behind us. Ahead of us, we have a variety of opportunities for further profitable growth. We do have the right products to take advantage of these opportunities – and the financial strength to make the necessary investments.”
- Bodo Uebber, Member of the Board of Management of Daimler AG responsible for Finance & Controlling and Daimler Financial Services: “We made a very good start to the year and once again surpassed our margin targets in the automotive business. We are very confident for the remainder of the year to achieve our financial as well as our strategic goals.”
Daimler AG (ticker symbol DAI) continued along its successful path in the first three months of 2017 and systematically implemented its strategy for a sustainable positive development. With sales of 754,300 passenger cars and commercial vehicles, the Daimler Group once again achieved best-ever unit sales (2016: 683,900) in a first quarter. This was primarily driven by record sales by Mercedes-Benz Cars with 568,100 units (+14%) and Mercedes-Benz Vans with 86,800 units (+13%).
Group revenue amounted to €38.8 billion, which is 11% higher than in the first quarter of last year. Adjusted for exchange-rate effects, revenue increased by 7%.
The Daimler Group achieved first-quarter EBIT of €4,008 million in 2017, thus substantially surpassing the prior-year figure of €2,148 million. Net profit doubled to €2,801 million (Q1 2016: €1,400 million). Net profit attributable to the shareholders of Daimler AG increased to €2,706 million (Q1 2016: €1,353 million), so earnings per share increased to €2.53 (Q1 2016: €1.26).
“A very successful quarter lies behind us,” stated Dr. Dieter Zetsche, Chairman of the Board of Management of Daimler AG and Head of Mercedes-Benz Cars. “Ahead of us, we have a variety of opportunities for further profitable growth. We do have the right products to take advantage of these opportunities – and the financial strength to make the necessary investments. The latest example: our new S-class. Daimler remains on the fast lane.”
Mercedes-Benz Cars achieved particularly strong earnings growth. Its EBIT growth is mainly the result of increased unit sales of the new E-Class and the SUV models. The Daimler Trucks division significantly improved its earnings, primarily due to the sale of real estate in Japan. Mercedes-Benz Vans and Daimler Buses also achieved significantly higher EBIT than in the prior-year period. At Daimler Financial Services, earnings grew significantly mainly as a result of increased contract volume. Exchange-rate effects had a positive impact on operating profit at all the divisions.
“We made a very good start to the year and once again surpassed our margin targets in the automotive business,” said Bodo Uebber, Member of the Board of Management of Daimler AG responsible for Finance & Controlling and Daimler Financial Services. “We are very confident for the remainder of the year to achieve our financial as well as our strategic goals. At the same time, we are constantly aware of the political and economic challenges and will continue to act flexibly and cautiously.”
Free cash flow and net liquidity
In the first quarter of 2017, the free cash flow of the industrial business amounted to a cash inflow of €1.9 billion (Q1 2016: €0.3 billion). This increase resulted primarily from the positive business performance and the development of working capital. The figure reflects a cash inflow of €0.3 billion from the sale of real estate at the Kawasaki site in Japan as well as higher supplier liabilities for seasonal reasons.
Compared with December 31, 2016, the net liquidity of the industrial business increased by €1.3 billion to €21.1 billion. The increase was mainly due to the positive free cash flow. Opposing effects resulted in particular from the capital increase at Daimler Financial Services AG.
The Daimler Group once again utilized attractive conditions in the international money and capital markets for refinancing in the first quarter of 2017. In the first three months of this year, Daimler had a cash inflow of €6.7 billion from the issuance of bonds (Q1 2016: €7.3 billion). The redemption of bonds resulted in cash outflows of €4.8 billion (Q1 2016: €2.6 billion). A large proportion of the issuance volume was carried out in the form of so-called benchmark bonds (bonds with high nominal values). At the beginning of January, Daimler Finance North America LLC issued bonds with three-, five- and ten-year maturities in the US capital market with a total volume of US$3.0 billion. In February, Daimler AG issued an eight-year bond of €1.25 billion in the European capital market. In addition, multiple smaller issuances were undertaken in various countries. Among other things, Daimler AG issued a one-year bond with a volume of RMB3.0 billion in the Chinese capital market in March.
Workforce
At the end of the first quarter of 2017, the Daimler Group had 285,810 employees worldwide (end of 2016: 282,488, end of March 2016: 285,992). Of that total, 171,084 were employed in Germany (end of 2016: 170,034) and 22,728 in the United States (end of 2016: 21,857). The consolidated companies in China had 3,782 employees at the end of March (end of 2016: 3,696).
Read the report HERE
Source: Daimler AG
