The Munich carmaker bmw is more confident about its financial year in view of the full order books. The company raised its profitability forecast and also expects more deliveries. However, BMW is bracing for headwinds in the second half and lowered its cash flow guidance.
This was not initially well received on the stock exchange: the shares lost almost 6 percent at their peak, but were able to reduce their losses to 1.80 percent at 103.4 euros in the early afternoon. Analysts took offense primarily at the reduced outlook for free cash flow in the auto business, which should now only amount to at least six instead of around seven billion.
In the past quarter, BMW benefited from persistently high vehicle prices and the full consolidation of the China-business. Revenues increased by 7 percent to 37.2 billion euros, the pre-tax profit improved by 7.5 percent to 4.2 billion euros, as the carmaker announced on Thursday.
However, the net profit in the second quarter was slightly weaker than in the same period last year at almost three billion euros. According to BMW, the reason is above all a one-off effect due to the integration of its Chinese joint venture BMW Brilliance into the group. On average, analysts had expected sales of EUR 37 billion and net profit of EUR 2.9 billion for the past quarter.
E-car sales more than doubled
Overall, BMW delivered 11.3 percent more vehicles in the first half of the year than in the same period last year. “The sale of vehicles with highly efficient combustion engines forms the solid foundation,” said BMW boss Oliver Zipse (59) on the figures. “And the strong growth comes from the significantly increasing demand for our all-electric vehicles.” The number of BMW brand e-cars delivered in the first half of the year rose by 133 percent compared to the previous year, and by 101.5 percent for all brands in the group.
The share of fully electric vehicles in sales was 12.6 percent in the first half of the year. This put BMW ahead of its rivals Mercedes Benz and Porsche, each reaching around 11 percent. In view of the great demand for electric cars, BMW wants to invest more money than previously planned in the expansion of e-mobility. In the second quarter, BMW had according to Bloomberg
increased its development spending by almost a fifth to 1.84 billion euros ($2 billion).
In China, the third most important market for BMW, the group said it increased sales by 3.6 percent. Like all German car manufacturers, BMW is struggling there with ever-increasing competition from domestic manufacturers such as BYD, but also from Tesla. BMW has kept global prices stable for its all-electric models, CEO Zipse said in a conference call, adding that the company is currently “fairly satisfied” with its selling prices in China.
Yield and sales forecast increased
The group had already announced on Tuesday set higher targets for the year as a whole. Accordingly, BMW is aiming for an operating profit margin before interest and taxes of 9 to 10.5 percent in the car business for the current year, previously the forecast was in the long-term range of 8 to 10 percent. on the of Tesla According to BMW, BMW does not want to take part in the price war instigated in China. CFO Walter Mertl spoke of “price discipline”.
Sales should also increase “solidly”, so far the Munich company had predicted a “slight” increase in deliveries. According to its own definition, BMW is now expecting an increase in sales of 5 to 9.9 percent instead of the previously expected increase of 1 to 4.9 percent.