Daimler first-quarter profit soars to 1.18 bln euros

29th April 2011, Comments 0 comments

The German luxury carmaker Daimler, which owns Mercedes-Benz, reported on Friday that its first-quarter net profit nearly doubled, underpinning an upbeat outlook for 2011 as a whole

Daimler said net profit jumped to 1.18 billion euros ($1.75 billion) in the three months from January to the end of March, from 612 million euros in the same period of 2010.

Analysts polled by Dow Jones Newswires had forecast a slightly higher profit of 1.26 billion euros however, and Daimler shares slumped heavily in early trades on the Frankfurt stock exchange.

Sales by the group gained 16.5 percent meanwhile to 24.7 billion euros, a statement said, in line with market expectations.

As has been the case with other German makers of premium automobiles, Daimler reiterated upbeat guidance for the rest of the year, forecasting core earnings before interest and taxes "to be significantly higher than in 2010."

The company posted Ebit last year of 7.27 billion euros.

First quarter Ebit soared by 71 percent on the year to two billion euros, Daimler said.

"We achieved excellent earnings in the first quarter. This puts us well ahead of our planning and confirms our positive outlook for the year 2011," chairman Dieter Zetsche added.

Sales were forecast to exceed the 2010 level of 97.8 billion euros, when Daimler sold nearly 1.9 million vehicles

Passenger car sales should gain more than seven percent this year, finance director Bodo Uebber told a telephone press conference.

All major regions and all divisions contributed to the strong first-quarter results.

The group reported spending of 49 million euros at Daimler Trucks, the world's leading heavy truck maker, in connection with the earthquake and tsunami in Japan, along with 29 million euros at Daimler Financial Services.

Mitsubishi Fuso, a key Daimler Truck brand, is based in Japan.

Uebber said the group expected further costs of between 50-100 million euros stemming from the disaster.

But tornadoes that slammed the southern United States this week, killing more than 300 people, did not do serious damage to the group's plant in Tuscaloosa, Alabama, the finance director added.

He said demand for passenger cars in China, now a crucial market for luxury auto makers, would increase by 10-15 percent this year, and forecast sustained growth in the future.

Shares in the group fell however by 2.11 percent to 51.97 euros in morning trades on the Frankfurt stock exchange, while the DAX index of German blue-chips was 0.13 percent lower overall.

© 2011 AFP

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