Munich - Daimler, the maker of Mercedes-Benz cars, said growth will slow down in 2016, predicting only “slight” gains in revenue and earnings following a record year.
The rate of increase in unit sales will be “rather lower” than in 2015, a year that showed “exceptional dynamism,” the German manufacturer said in a statement on Thursday. Group profit from ongoing operations will also increase “slightly,” it said.
After delivering record sales and robust profitability, Daimler is faced with a more moderate outlook in China, its most important market, leaving investors to question where further growth may come from. Also the world’s biggest truckmaker, Daimler’s commercial vehicle sales are set to continue to suffer from the recession in Brazil, while the US market is also slowing.
“Market expectations are very, very high, and while there’s nothing wrong with Daimler’s outlook, it probably won’t be enough to satisfy the market,” said Arndt Ellinghorst, a London- based analyst with Evercore ISI, saying the results may lead some investors to believe the company has peaked. Daimler’s cash-flow expectations are lower, at 3.8 billion ($4.2 billion) to 5.3 billion euros, than last year’s 5.9 billion euros, he said.
The shares fell as much as 3.43 euros, or 5.5 percent, to 59.54 euros, and traded at 61.19 euros at 9:07 a.m. in Frankfurt. Daimler has lost 21 percent this year, compared with an 11 percent decrease in the benchmark DAX Index.
Fourth-quarter operating profit from ongoing operations rose to 3.46 billion euros from 2.82 billion euros after it added new sport utility vehicles including the coupe-like Mercedes GLC, the Stuttgart, Germany-based company said. Sales rose 13 percent to 40.4 billion euros. The company plans to pay a record dividend of 3.25 euros for each share.
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“We know from experience: Getting to the top is hard, but staying at the top is even harder,” CEO Dieter Zetsche said in the statement.
Highlights for this year include the introduction of the revamped Mercedes E-Class sedan, its most important product. Low fuel prices also continue to favour sales of lucrative SUVs. Deliveries in China rose 33 percent last year, compared with a 4.7 percent gain for the total market, the slowest in three years.
BLOOMBERG