Daimler offers muted outlook despite record 2016

Frankfurt am Main (AFP) – Daimler group, the German carmaker behind Mercedes-Benz and Smart, on Thursday reported a record year in 2016 but disappointed investors with modest ambitions for 2017.

“In 2016, Daimler has set new records for unit sales, revenue and earnings,” chief executive Dieter Zetsche said in a statement.

The Stuttgart-based group lifted profits by 1.0 percent to 8.8 billion euros ($9.5 billion), beating analyst expectations.

Increased profits came on the back of a 3.0-percent increase in revenue to 153.2 billion euros, driven by strong performance in its cars and vans divisions.

Looking ahead, Daimler financial director Bodo Uebber said the group was “generally optimistic about 2017”, but he warned of a tough climate for its truck business.

Daimler aims to book a “slight growth” in revenues and operating profit in 2017, the group said in a statement.

“We are on a path of stable growth, along which we will systematically continue,” CEO Zetsche said.

Investors were unimpressed, sending Daimler shares plunging by nearly three percent to 67.93 euros in afternoon trading in Frankfurt.

Daimler’s outlook was “slightly below expectations,” said Equinet analyst Tim Schuldt.

Mercedes’ three-pointed star overtook Munich-based traditional rival BMW last year to become the largest luxury carmaker by unit sales, recovering a position it lost in 2005.

But Daimler was dragged down by weaknesses in its trucks unit, which suffered a 12-percent fall in sales in a difficult market environment to 33.2 billion euros.

Looking to operating, or underlying profit before interest and taxes, the group’s result fell 2.0 percent to 12.9 billion euros.

Saying it was investing heavily in future technologies such as electronic and self-driving cars, the group kept its dividend unchanged from 2015’s figure, at 3.25 euros per share.

The level of its employee bonuses also shrank, with the maximum level set at 5,400 euros for 2016 compared with the previous year’s 5,650 euros.

DZ Bank analyst Michael Punzet said the group’s 2016 figures fell mainly in line with expectations but “the unchanged dividend might disappoint somewhat.”