With a strong fourth quarter, the company exceeded the forecast for profitability in the automotive industry, as the DAX group surprisingly announced on Friday based on key data. In particular, Mercedes-Benz played the high car prices for new and used cars and the focus on expensive models such as the S-Class and Maybach.
According to the preliminary calculations, the Board of Management now expects an adjusted return on sales of 12.7 percent for the division with cars and vans last year and earnings before interest and taxes (EBIT) adjusted for special effects of 14 billion euros – that was more than twice as much much as in the previous year, which was burdened by corona lockdowns, when the Daimler group, which still existed at the time, achieved an operating result of 6.8 billion euros here.
In the final quarter, Mercedes drove a return on sales of a high 15 percent – the market had only expected around 11 percent. For every 100 euros in revenue, 15 euros remained as an operating profit. Experts from the investment bank Stifel spoke of far better results than expected.
As already known, the carmaker delivered 464,130 cars with its main brand Mercedes-Benz in 2021, five percent less than in the previous year – despite weeks of plant shutdowns in spring 2020 due to the outbreak of the Corona crisis. Sales plummeted in the second half of 2021 in particular. This was mainly due to the bottleneck in semiconductors and other electronic components. The vans in the group delivered 2.6 percent more cars with 334,210 vehicles. Overall, however, the manufacturer handed over only 2.43 million vehicles to customers. That was four percent less than in the previous year.
However, the management around boss Ola Källenius had decided to prioritize the installation of available semiconductors in more lucrative models and electric cars in order to still make the highest possible profit. When looking at the sales figures for the past year, Mercedes had already said that the luxury and sports car brands Maybach and AMG, but also the high-yield S-Class and the G-Class off-road vehicle were well received by buyers. Long delivery times, which result from the limited production and the currently high demand, lead to high sales prices on the market – hardly any dealer is currently granting large discounts when buying a car as was common in the past.
“Our good result is the result of products that are in high demand as well as the focus on profitable growth and cost discipline,” said Källenius, who embarked on a sharp austerity course at the carmaker after taking office in 2019. In addition to the net pricing, a “good product mix” and a “favorable used car performance” were drivers of the development, the company said.
Because leasing returns can be sold more expensively on the used car market, this increases the results of the financial and mobility services division Mercedes-Benz Mobility, where the leasing cars are on the balance sheet. Mercedes-Benz Mobility achieved an adjusted return on equity of around 22 percent, which is at the upper end of the previous target range of 20 to 22 percent. Based on preliminary figures, the division achieved adjusted operating earnings before interest and taxes of 3.4 billion euros.
According to the group, no group financial data are available at the current time due to various effects from the deconsolidation of the Daimler commercial vehicle business. However, the company expects the listing of Daimler Truck to have a highly positive one-off effect. The operating result before interest and taxes at group level will be 9 to 10 billion euros better, it said. From the management’s point of view, however, this valuation effect should not be included in the calculation of the dividend proposal. The special effects have no impact on the cash flow in the group. The truck and bus manufacturer Daimler Truck went public in mid-December.
The final figures including the net result for 2021 are to be published on February 24. The annual report will then follow on March 11th.
Rally at Mercedes-Benz after strong key data for 2021
The shares of Mercedes-Benz reacted to the announcement of the first business figures for 2021 with a rapid rise in price on Friday afternoon. The carmaker’s shares took the lead in the DAX with an increase of 6.72 percent to EUR 74.44 and also left the 50-day line behind. This is considered an indicator for the medium-term trend. In the daily high they even climbed to 75.36 euros.
The automaker exceeded expectations in the final quarter, according to Jefferies analyst Philippe Houchois. A strong end to 2021 in every respect should push up expectations for 2022, after all management has indicated higher margins year-on-year, the expert added.
STUTTGART / FRANKFURT (dpa-AFX)
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