Daimler Posts Record Profits

30% increase in net profits

Daimler posted an annualized 30% jump in net profit to 1.7 billion euros, while core earnings before interest and taxes (EBIT) reached 2.581 billion euros, from 2.104 billion in the same period a year earlier.

Analysts polled by Dow Jones Newswires had anticipated a net profit of 1.58 billion euros and EBIT of 2.47 billion.

Daimler forecast that its full-year core earnings "will very significantly exceed the level of 2010," or 7.3 billion euros. The company also now expects full-year sales to be "significantly more than 100 billion euros."

An analyst quoted by Dow Jones nonetheless said that Daimler's results were boosted substantially by its financial services unit, while the auto division was losing market share to BMW and Audi.

In the three months from April through June however, group sales gained 4.8% to 26.3 billion euros, while Mercedes-Benz Cars posted its strongest core earnings ever at 1.566 billion euros, up from 1.376 billion a year before.

"The very good earnings trend is primarily a reflection of increased vehicle shipments by nearly all divisions," said Daimler CEO Dieter Zetsche.

The group's financial services unit posted core earnings of 340 million euros, almost double the year earlier figure of 171 million euros.

Strong demand for luxury cars in many major markets allowed Daimler to deliver a total of almost 360,000 vehicles in the three-month period, a figure that included sales of the group's Smart city car.

"We are fully on schedule to turn 2011 into one of the most successful years in our long corporate history," Zetsche said.

A pick up in global activity also boosted demand for Daimler trucks, which reported a 9% in unit sales to 91,500 vehicles, while the value of those sales was 14% higher at 6.6 billion euros.

The analyst quoted by Dow Jones nonetheless said auto unit sales were below expectations and added: "This clearly shows that BMW and Audi are performing better and that Daimler is losing market share in the higher price segment."

Copyright Agence France-Presse, 2011

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