Daimler nearly doubles first-quarter profit

Daimler nearly doubles first-quarter profit
Photo: DPA
Germany's Daimler, which owns luxury carmaker Mercedes-Benz, said Friday that its first-quarter net profit nearly doubled, underpinning a positive outlook for 2011 as a whole.

Daimler said its net profit jumped to €1.18 billion ($1.75 billion) in the three months from January through March from €612 million in the same period of 2010. Sales gained 16.5 percent to €24.7 billion.

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

As has been the case with rival 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.”

First quarter Ebit soared by 71 percent on the year to €2.031 billion, the company 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 said in a statement.

“We are on the right track. We want to delight our customers with fascinating products and strong brands, and we intend to continue our profitable growth.”

All major regions and all divisions, from Mercedes-Benz Cars to Daimler Trucks, Mercedes-Benz Vans and Daimler Financial Services, contributed to the strong results.

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

Mitsubishi Fuso, a Daimler Truck unit, is based in Japan. The group said it expected further costs of between €50-100 million 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.

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

AFP/The Local/mry

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