Daimler has powerful Q2 as Mercedes' margins improve
FRANKFURT -- Daimler said as it reserved a gain from selling its stake in aerospace group EADS its secondquarter operating profit more than doubled and the Mercedes division bounced back from a feeble beginning to
2013. Daimler's profits before interest and taxation (Ebit) for the quarter were 5.2 billion euros ($6.8 billion), the firm said on Friday.
Secondquarter Ebit at MercedesBenz automobiles, which contains the Smart citycar brand, fell to 1.04 billion euros from 1.31 billion euros a year before, while earnings increased 6 percent to 16.3 billion euros. The profit decline reflected an on-going downturn in selfinflicted supply difficulties and European markets in China.
Daimler's complete quarterly operating profit was improved by a onetime gain from a deal of its position in EADS, owner of plane manufacturer Airbus.
Three analysts had anticipated an amount of 1.7 billion euros normally.
"The numbers are extremely, really strong," said Sascha Gommel, a Frankfurtbased analyst at Commerzbank. Profitability at Mercedes "is considerably better than anticipated, thanks obviously to the design cycle," he said.
However the business has begun a brand new period of model rollouts and has a target of 2 billion euros in savings by the end of next year, with onethird of that predicted in
2013. To foster deliveries, Mercedes is investing in new entrylevel versions like the CLA fourdoor compact coupe along with the A-class hatchback, in addition to revamping its top-of-theline S class with conveniences like a hotstone massage function in the trunk passenger seats.
The consequence certainly is that Daimler is bouncing back from the initial quarter, said Frankfurtbased Bankhaus Metzler analyst Juergen Pieper. "Cost savings and approaching model releases should underpin a secondhalf uptrend."
Firsthalf deliveries at the marque increased 6.4 percent to 694,433 automobiles and sportutility vehicles, a report for the period, Daimler said on July 3. Its full quarterly report will be published by the company on July 24. Daimler also reaffirmed its fullyear guidance.
2011. The Daimler Trucks division, the planet's largest manufacturer of heavy vehicles, as well as the bus unit posted charges totaling 102 million euros for job cuts and other reorganization measures.
Zetsche, who also directs the MercedesBenz Cars department, sold Daimler's position in EADS (European Aeronautic, Defence & Space Co.) in April to concentrate on the automobile company.
Daimler's move to promote its EADS holding came after EADS investors approved changes in its ownership structure before this year, enabling Daimler to depart the business. EADS was formed in 2000 from the amalgamation of numerous European aerospace businesses, including Daimler's DASA. The German carmaker received a 30 percent stake after EADS' creation, scaling it down with time.
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