BMW eyes record earnings in 2004
17 March 2004
MUNICH – German carmaker BMW on Wednesday said that after last year’s slight earnings decline, the company is poised for strong profits growth this year, with aims to set a new record topping EUR 3.3 billion.
Chairman Helmut Panke made the prediction while discussing BMW’s 2003 figures, saying that his company expected to gather the fruits of its offensive of new models while defying the overall weakness in the car market.
“We’re keeping our foot on the gas pedal and we’re going to accelerate further,” Panke said, predicting that all three brands in the company’s lineup – BMW, the Mini, and Rolls-Royce – will show new sales records in 2004.
In 2003, BMW’s consolidated net profit fell by 3.6 percent to EUR 1.9 billion, while sales revenues slipped to EUR 41.5 billion, from EUR 42.4 billion the year before.
The revenues came on car sales of 1.1 million, up 4.5 percent from 2002 levels, even though it is only this year when most of the new models in the company’s lineup will be put on the market.
The BMW chief executive declined to mention a sales revenues target for 2004, pointing to the volatility of currency exchange rates which make such predictions risky.
Panke said that for BMW, the picture was one of growth expectations abroad, as against a domestic German market which was still in a slump.
On foreign markets like the United States, the rest of Europe and Asia, BMW is on a path of growth. “We have no problem children,” Panke said about prospects outside Germany.
But after sales at home slipped in 2003, the situation in Germany remained a problem.
“At the moment buyers are still holding back,” Panke said, stressing that the German market continued to have a central role in BMW’s business strategy.
Financial officer Stefan Krause confidently predicted that BMW was “on the path in a new dimension” regarding sales, but stressed that the growth is profit-oriented. Also, the company was taking provisions against currency-related risks.
“We have already undertaken major strategic currency risk precautions for 2004 and 2005,” Krause said.
The BMW executives’ presentation and company figures were comparatively well-received on the Frankfurt Stock Exchange, where BMW shares were running 1.76 percent higher at 34.04 euros around noon. The rise was moderately above the 1.15 percent overall gains shown by the 30-share DAX Index at that point.
Subject: German News