Daimler reports on successful second quarter

                 Daimler reports on successful second quarter

PR Newswire

STUTTGART, Germany, July 24, 2013

STUTTGART, Germany, July 24, 2013 /PRNewswire/ --

  oGroup EBIT of €5,242 million (Q2 2012: €2,268 million), thereof €3.2
    billion from the sale of remaining EADS shares
  oNet profit of €4,583 million (Q2 2012: €1,565 million)
  oUnit sales up by 6% to 605,800 vehicles
  oRevenue of €29.7 billion (Q2 2012: €28.9 billion)
  oGrowth in unit sales and revenue anticipated for full-year 2013
  oSignificant improvements anticipated for second half of year due to launch
    of new products, increasing impact of efficiency programs and current
    market assumptions
  oOutlook confirmed for full year

The earnings posted by Daimler AG (ticker symbol DAI) for the second quarter
of 2013 were significantly higher than in the second quarter of last year and
than the market expected. Daimler's Group EBIT for the period of April through
June amounted to €5,242 million (Q2 2012: €2,268 million). Earnings for the
second quarter were boosted by a gain totaling €3.2 billion related to the
remeasurement and to the sale of the remaining EADS shares. As a result of
that transaction, net profit amounted to €4,583 million (Q2 2012: €1,565
million). Earnings per share amounted to €2.65
(Q2 2012: €1.39); adjusted for the EADS effect, earnings per share were €1.25.

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"As we previously announced, our earnings in the second quarter improved
significantly compared with the first three months of the year and exceeded
market expectations. This represents progress in our earnings development, but
no cause for complacency. We will continue to work hard on achieving our
goals," stated Dr. Dieter Zetsche, Chairman of the Board of Management of
Daimler AG and Head of Mercedes-Benz Cars.

"We presented the new S-Class in May, which met with an excellent response,
and our compact-car offensive is also continuing very successfully. The
completely upgraded range of Mercedes-Benz trucks in Europe, the first to be
fully available with Euro VI emission technology, has also been very well
received by the customers. As a result of our new products, the increasing
impact of the efficiency programs running in all business units and the
further development of the markets that are especially important for us, we
can assume that our earnings in the second half of 2013 will be significantly
better than in the first six months of the year," continued Dr. Zetsche.

"The free cash flow of the industrial business was at the encouragingly high
level of €3.5 billion because both the ongoing business operations and the
sale of the remaining shares in EADS led to cash inflows in the second
quarter. At the same time, we continue to invest in products and projects that
underpin our future growth," explained Bodo Uebber, Member of the Board of
Management of Daimler AG for Finance & Controlling and Financial Services.

At the Mercedes-Benz Cars division, growth in unit sales in the second quarter
was not fully reflected in earnings, primarily due to the changed product mix.
And Daimler Trucks' earnings were reduced by ongoing weak demand, especially
in Asia and Western Europe. Mercedes-Benz Vans and Daimler Buses improved
their earnings in the second quarter of 2013, while Daimler Financial
Services' EBIT decreased.

The compounding of non-current provisions and effects resulting from higher
discount factors led to income of €13 million in the second quarter (Q2 2012:
expenses of €77 million). Exchange-rate effects had a slightly positive impact
on EBIT.

The special items that affected EBIT in the second quarter are shown in the
table on page 11.

Unit sales up by 6% compared with prior-year quarter

In the second quarter of 2013, the Daimler Group sold 605,800 cars and
commercial vehicles worldwide, surpassing the prior-year by 6%.

The Daimler Group's second-quarter revenue amounted to €29.7 billion, which is
3% higher than in the second quarter of last year. Adjusted for exchange-rate
effects, revenue grew by 5%.

The free cash flow amounted to €2.3 billion in the first half of 2013. The net
liquidity of the industrial business of €11.3 billion was slightly below the
level of December 31, 2012.

At the end of the second quarter of 2013, Daimler employed 276,044 people
worldwide (end of Q2 2012: 273,749). Of that total, 167,926 were employed in
Germany (end of Q2 2012: 166,477), 21,555 in the United States (end of Q2
2012: 22,137), 14,348 in Brazil (end of Q2 2012: 14,712) and 11,404 in Japan
(end of Q2 2012: 11,417). The consolidated subsidiaries in China employed
1,834 people at the end of the second quarter (end of Q2 2012: 2,374). The
decreased headcount in China resulted from the integration of the sales
organizations for cars into a non-consolidated joint-venture company. In South
Africa, employees in sales functions were previously allocated to the
Mercedes-Benz Cars division and are now reported within the sales

Details of the divisions

Mercedes-Benz Cars achieved a new record for unit sales in the second quarter
of 2013. Total sales of the car division increased by 9% to 404,700 units (Q2
2012: 370,400), and second-quarter revenue increased by 6% to €16.3 billion.
The division achieved EBIT of €1,041 million, which is below the prior-year
level (Q2 2012: €1,337 million), and a return on sales of 6.4% (Q2 2012:

The development of earnings primarily reflects the ongoing growth in unit
sales, especially in the United States and Western Europe. Mercedes-Benz Cars
achieved high growth rates above all in the compact-car segment. Exchange-rate
effects also had a positive impact on earnings. Among other things, the
changed model mix had a negative effect on earnings. The decrease in earnings
was additionally caused in particular by expenses connected with product
enhancements and to increase production capacities, as well as advance
expenditure for new technologies and vehicles. To a growing extent, efficiency
actions from the "Fit for Leadership" program had a positive impact on

Daimler Trucks' second-quarter unit sales were slightly above the prior-year
level at 123,800 vehicles (+1%). Revenue reached €8.0 billion (-2%). The
division's EBIT was lower than in the prior-year period at €434 million (Q2
2012: €524 million), and its return on sales was 5.4% (Q2 2012: 6.4%).

Unit sales revived slightly, with stimulus in particular from the market
recovery in Brazil. Ongoing weak demand in Asia and Western Europe, higher
warranty costs and exchange-rate effects had a negative impact on earnings. In
addition, charges on earnings of €82 million arose from personnel actions in
the context of an optimization program in Germany and Brazil. The efficiency
actions of the "Daimler Trucks #1" program had an increasingly positive effect
on earnings.

Despite a difficult market environment in Western Europe, Mercedes-Benz Vans
slightly improved on its unit sales of the prior-year period, selling 69,400
vehicles in the second quarter (Q2 2012: 69,300). Revenue of €2.4 billion was
of the magnitude of the prior-year quarter. The division achieved EBIT of €204
million (Q2 2012: €200 million). Return on sales increased to 8.4%, from 8.3%
in the second quarter of last year.

In a market environment that was still affected by weak demand and intense
competition in Europe, unit sales by Mercedes-Benz Vans were slightly higher
than in the second quarter of last year. Earnings were negatively impacted by
changes in the product mix, as well as advance expenditure for new products,
including the launch of the Sprinter Classic in Russia. There were positive
effects from better pricing, lower material costs and reduced warranty

Daimler Buses sold 7,900 buses and bus chassis worldwide in the second quarter
of 2013 (Q2 2012: 8,400). Revenue amounted to €0.9 billion (Q2 2012: €1.0
billion). The division posted second-quarter EBIT of plus €27 million, which
is a significant improvement over the prior-year quarter (Q2 2012: minus €59
million). Return on sales improved to plus 2.9% (Q2 2012: minus 5.8%).

The development of earnings was driven by unit-sales growth in the European
business as well as significant efficiency advances. Compared with the second
quarter of last year, expenses for the repositioning of the European and
American business systems decreased to €20 million (Q2 2012: €46 million).

Daimler Financial Services concluded around 298,000 new leasing and financing
contracts with a total value of €10.3 billion in the second quarter, achieving
growth of 10% compared with the prior-year period. Contract volume reached
€81.4 billion at the end of June, which is 2% higher than at the end of 2012.
Adjusted for exchange-rate effects, the increase was 4%. The division's EBIT
of €319 million in the second quarter was lower than in the prior-year period
(Q2 2012: €338 million).

The earnings development primarily reflects lower interest margins. The
increased contract volume and lower credit-risk costs had positive effects on

The reconciliation of the divisions' EBIT to Group EBIT comprises income and
expenses at the corporate level as well as effects on earnings from the
elimination of intra-group transactions between the divisions.

At the corporate level, there was income of €3,189 million (Q2 2012: expense
of €59 million). This includes a special item from the former equity interest
in EADS amounting to €3,209 million. In early April, Daimler left the former
EADS shareholder pact. Due to the resulting loss of significant influence, the
EADS shares were no longer accounted for using the equity method. This
resulted in a gain of €3,356 million in the second quarter. On April 17, 2013,
the Group sold its remaining EADS shares, comprising a stake in EADS of
approximately 7.4%, by way of an accelerated book-building process; the
development of the EADS share price between April 2, 2013 and the date of the
sale resulted in a charge of €184 million in the second quarter of 2013. In
addition, Daimler concluded an agreement with cash settlement allowing it to
participate to a limited extent in a possible increase in the EADS share price
until the end of 2013. This resulted in a gain of €30 million in the second
quarter of 2013. An additional gain from the equity-method measurement of €7
million is also included.

The elimination of intra-group transactions resulted in income of €28 million
in the second quarter of 2013 (Q2 2012: expense of €13 million).


From today's perspective, worldwide demand for cars still seems likely to
expand by between 2 and 4% this year. Growth will primarily be driven by the
continuation of robust increases in demand in the United States and by the
ongoing significant expansion of the Chinese market. Falling demand for cars
meanwhile seems to have bottomed out in Western Europe, and a gradual
improvement of the market situation is to be anticipated in the second half of
the year. As the general economic environment is still weak, a significant
decline is expected for the full year, however. The German car market should
follow a similar path as the year progresses, but will also be significantly
smaller in 2013 than last year. Market contraction is anticipated also in
Japan, primarily due to unusually strong demand in the previous year caused by
state incentives for car buyers.

From today's perspective, global demand for medium and heavy-duty trucks is
expected to grow slightly in 2013. However, this depends quite crucially on
the development of the world's biggest market, China, where a significant
recovery recently started which should continue in the coming months. But the
ongoing rather moderate economic dynamism gives cause for uncertainty about
upcoming market developments. Daimler anticipates a stabilization of demand in
North America, but no significant upward trend can be expected in the second
half of this year from today's perspective. Daimler therefore anticipates
market contraction of up to 5% for the full year. The European truck market is
expected to revive moderately as the year progresses, but a decline of about
5% is likely for the full year due to the difficult economic situation. The
extent of purchases possibly brought forward before the introduction of Euro
VI emission regulations next year is currently difficult to assess. This
special effect could have a positive impact on the market towards the end of
the year. Market volume in Japan is likely to be up to 5% below the level of
last year, whereby the effects of the new Japanese government's economic
stimulus program on the market for medium and heavy-duty trucks are still hard
to assess. For the Brazilian market, ongoing market recovery and growth of up
to 10% are to be expected, despite the somewhat worsened economic outlook. The
Russian market has meanwhile almost returned to the pre-crisis level and at
best might maintain this level in full-year 2013. In India, demand for trucks
is expected to fall due to ongoing below-average levels of economic growth.

On the basis of the divisions' planning, Daimler expects its total unit sales
to increase again in the year 2013.

Mercedes-Benz Cars is consistently pursuing the "Mercedes-Benz 2020"
offensive. Numerous model changes and new products should ensure that the
division reaches a new record for unit sales in 2013. The new models in the
high-volume compact-car segment are expected to make a large contribution to
the growth in unit sales. And the new E-Class coupes and convertibles have
provided additional sales impetus since June. The battery-powered and thus
locally emission-free super sports car SLS AMG Coupe Electric Drive has also
been on the market since June. For the second half of 2013, Mercedes-Benz
anticipates significant growth in the luxury segment, due above all to the
launch of the new S-Class. As the most important new model of the year 2013,
the new S-Class will set new standards with regard to comfortable and safe
driving with pioneering innovations packaged under the name of "Mercedes-Benz
Intelligent Drive." Furthermore, the Mercedes-Benz brand will continue to
profit this year from the great market success of its models in the SUV

Despite its advancing lifecycle, the smart brand sees good chances that the
unique two-seater will perform well in the highly competitive micro-car
segment also in 2013, with unit sales in the magnitude of last year.

Daimler Trucks plans to achieve slight growth in unit sales this year. After
the continuingly difficult economic situation in numerous key markets led to a
slight decrease in unit sales in the first half of the year, as had been
expected, a revival of demand for the division's vehicles is anticipated in
the second half. In Europe, on the basis of a general slight market recovery
and supported by the excellent response to the completely renewed
Mercedes-Benz truck range, it is assumed that unit sales will increase as the
year progresses. Furthermore, in some of the region's markets, some purchases
are expected to be brought forward due to the upcoming introduction of the
stricter Euro VI emission limits in 2014, although the extent of this effect
is still hard to estimate. In Brazil, the main market of Latin America,
Daimler Trucks is participating in the current market recovery with its Euro V
vehicles. In the NAFTA region, following a drop in market demand in the first
half of the year, there should be at least some general market stabilization
in the remaining months of 2013. In view of Daimler Trucks' high market share
in the region, the division expects to post slightly higher unit sales than in

The brands Fuso and BharatBenz will make a significant contribution to the
growth in unit sales. Going beyond the current market presence, they offer
additional sales possibilities in Asia and Africa. In this context, Daimler
Trucks presented special Fuso models in May, which are now being produced in
India for those markets. With the expansion as planned of cooperation with
local partners Kamaz and Foton in Russia and China, the division is utilizing
further growth potential.

Mercedes-Benz Vans assumes that it will increase its unit sales in 2013. On
the product side, the new Mercedes-Benz Citan and in the second half of 2013
also the new-generation Sprinter should contribute to that growth. Local
production of the Sprinter Classic in Russia should also allow the division to
further increase its unit sales in that growth market.

Daimler Buses anticipates a significant increase in unit sales in 2013,
whereby the share of bus chassis in total unit sales is likely to increase. A
significant revival of demand is expected especially in Latin America in
full-year 2013, provided that the current political situation in Brazil, the
region's biggest market, does not have a negative impact on public transport.
For the business with complete buses in Europe, the division anticipates a
stable development with ongoing low volumes.

Daimler Financial Services expects further growth in new business and contract
volume in full-year 2013.

Following significant growth in 2012, Daimler assumes that Group revenue will
increase again in 2013. In regional terms, above-average growth rates are
anticipated for the emerging markets as a whole and also for North America.

As a result of the new products launched in the first half of the year, the
increasing impact of the efficiency programs that have been initiated, and
Daimler's assumptions for the development of important markets, earnings are
expected to improve significantly in the second half of 2013 compared with the
first half. On the basis of current market assessments and since there will be
no further equity-method earnings from EADS, Group EBIT from the ongoing
business in full year 2013 is expected to be below the previous year's level.

Mercedes-Benz Cars assumes that full-year EBIT will be below the prior-year
level. Daimler Trucks and Mercedes-Benz Vans expect to post EBIT from the
ongoing business in the magnitude of 2012, while Daimler Buses should improve
on last year's earnings. In 2014 and the following years, Daimler anticipates
an improvement in operating profit for all the automotive divisions and for
the Group. A stable earnings development is expected for Daimler Financial

From today's perspective, Daimler assumes that the number of employees
worldwide will remain stable compared with the end of 2012.

The items listed in the following table affected EBIT in the second quarters
of 2013 and 2012:

Special items affecting EBIT
In millions of euros                                  Q2 2013 Q2 2012
Daimler Trucks                                               
Workforce adjustment
                                                      -82     -
Daimler Buses                                         -20     -46
Business repositioning
                                                      3,209   -
EADS – remeasurement and sale of the remaining shares

Further information from Daimler is available at:
www.media.daimler.com and www.daimler.com

This document contains forward-looking statements that reflect our current
views about future events. The words "anticipate," "assume," "believe,"
"estimate," "expect," "intend," "may," "plan," "project," "should" and similar
expressions are used to identify forward-looking statements. These statements
are subject to many risks and uncertainties, including an adverse development
of global economic conditions, in particular a decline of demand in our most
important markets; a worsening of the sovereign-debt crisis in the euro zone;
a deterioration of our funding possibilities on the credit and financial
markets; events of force majeure including natural disasters, acts of
terrorism, political unrest, industrial accidents and their effects on our
sales, purchasing, production or financial services activities; changes in
currency exchange rates; a shift in consumer preference towards smaller, lower
margin vehicles; or a possible lack of acceptance of our products or services
which limits our ability to achieve prices as well as to adequately utilize
our production capacities; price increases in fuel or raw materials;
disruption of production due to shortages of materials, labor strikes, or
supplier insolvencies; a decline in resale prices of used vehicles; the
effective implementation of cost-reduction and efficiency-optimization
measures; the business outlook of companies in which we hold a significant
equity interest; the successful implementation of strategic cooperations and
joint ventures; changes in laws, regulations and government policies,
particularly those relating to vehicle emissions, fuel economy and safety; the
resolution of pending governmental investigations and the conclusion of
pending or threatened future legal proceedings; and other risks and
uncertainties, some of which we describe under the heading "Risk Report" in
Daimler's most recent Annual Report. If any of these risks and uncertainties
materialize, or if the assumptions underlying any of our forward-looking
statements prove incorrect, then our actual results may be materially
different from those we express or imply by such statements. We do not intend
or assume any obligation to update these forward-looking statements. Any
forward-looking statement speaks only as of the date on which it is made.

About Daimler
Daimler AG is one of the world's most successful automotive companies. With
its divisions Mercedes-Benz Cars, Daimler Trucks, Mercedes-Benz Vans, Daimler
Buses and Daimler Financial Services, the Daimler Group is one of the biggest
producers of premium cars and the world's biggest manufacturer of commercial
vehicles with a global reach. Daimler Financial Services provides financing,
leasing, fleet management, insurance and innovative mobility services.

The company's founders, Gottlieb Daimler and Carl Benz, made history with the
invention of the automobile in the year 1886. As a pioneer of automotive
engineering, Daimler continues to shape the future of mobility today: The
Group's focus is on innovative and green technologies as well as on safe and
superior automobiles that appeal to and fascinate its customers. For many
years now, Daimler has been investing continually in the development of
alternative drive systems with the goal of making emission-free driving
possible in the long term. So in addition to vehicles with hybrid drive,
Daimler now has the broadest range of locally emission-free electric vehicles
powered by batteries and fuel cells. This is just one example of how Daimler
willingly accepts the challenge of meeting its responsibility towards society
and the environment. Daimler sells its vehicles and services in nearly all the
countries of the world and has production facilities on five continents. Its
current brand portfolio includes, in addition to the world's most valuable
premium automotive brand, Mercedes-Benz, the brands smart, Freightliner,
Western Star, BharatBenz, Fuso, Setra and Thomas Built Buses. The company is
listed on the stock exchanges of Frankfurt and Stuttgart (stock exchange
symbol DAI). In 2012, the Group sold 2.2 million vehicles and employed a
workforce of 275,000 people; revenue totaled €114.3 billion and EBIT amounted
to €8.6 billion.

Figures for the 2^nd Quarter 2013/First Half-Year 2013
Daimler Group            Q2       Q2       Change  YTD       YTD       Change
amounts in €            2013     2012     13/12   2013      2012      13/12
Revenue, in millions    29,692   28,884   + 3 %   55,794    55,895    - 0 %
EBIT, in millions*      5,242    2,268    + 131 % 6,159     4,366     + 41 %
Net profit, in           4,583    1,565    + 193 % 5,147     2,990     + 72 %
Earnings per share       2.65     1.39     + 91 %  3.16      2.65      + 19 %
Employees (June 30)      276,044  273,749  + 1 %   276,044   273,749   + 1 %
EBIT by Divisions*    Q2       Q2       Change  YTD       YTD       Change
in millions of €        2013     2012     13/12   2013      2012      13/12
Mercedes-Benz Cars       1,041    1,337    - 22 %  1,501     2,567     - 42 %
Daimler Trucks           434      524      - 17 %  550       900       - 39 %
Mercedes-Benz Vans      204      200      + 2 %   285       367       - 22 %
Daimler Buses           27       -59      -       -4        -164      -
Daimler Financial        319      338      - 6 %   633       682       - 7 %
Reconciliation           3,217    -72      -       3,194     14        -
Revenue by Divisions     Q2       Q2       Change  YTD       YTD       Change
in millions of €         2013     2012     13/12   2013      2012      13/12
Mercedes-Benz Cars       16,324   15,364   + 6 %   30,434    30,301    + 0 %
Daimler Trucks           7,965    8,129    - 2 %   14,989    15,512    - 3 %
Mercedes-Benz Vans       2,434    2,420    + 1 %   4,420     4,508     - 2 %
Daimler Buses            934      1,016    - 8 %   1,685     1,746     - 3 %
Daimler Financial        3,548    3,260    + 9 %   7,125     6,400     + 11 %
Reconciliation           -1,513   -1,305   -       -2,859    -2,572    -
Unit Sales               Q2       Q2       Change  YTD       YTD       Change
in units                 2013     2012     13/12   2013      2012      13/12
Daimler Group            605,823  570,343  + 6 %   1,107,423 1,072,429 + 3 %
Mercedes-Benz Cars      404,711  370,384  + 9 %   746,222   708,687   + 5 %
Daimler Trucks           123,763  122,217  + 1 %   225,196   229,881   - 2 %
Mercedes-Benz Vans       69,436   69,324   + 0 %   122,059   120,547   + 1 %
Daimler Buses            7,913    8,418    - 6 %   13,946    13,314    + 5 %
*The 2012 figures were adjusted for the effects of the application of the
revised IAS 19.

SOURCE Daimler Corporate Communications

Website: http://www.daimler.com
Contact: Han Tjan, +1 212 909-9063, or Florian Martens, +49 711 17-35014
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