Daimler AG’s Truck Business Continues To Push Growth In Q1 2019
Daimler AG (OTCMKTS: DDAIF), the German auto giant engaged in the development, production, and distribution of cars, vans, trucks and buses, announced its Q1 2019 results on April 26, 2019, followed by a conference call with analysts. The company beat consensus for revenue which was recorded at $44.9 billion, down by 8% year on year. The decrease was driven largely by the negative effect of euro to dollar conversion rates. The earnings also beat consensus and were recorded at $2.21, lower than $2.61 per share in the same period of 2018.
We have summarized our key expectations from the earnings announcement in our interactive dashboard – What Has Driven Daimler AG’s Revenues & Expenses Over Recent Quarters, And What Can We Expect For Full-Year 2019? In addition, here is more Consumer Discretionary data.
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Key Factors Affecting Earnings:
Revenue beats consensus in Q1 2019:
- Daimler AG’s Total Revenue in Q1 2019 was recorded at $44.9 billion, down 8% year-on-year. This was driven largely by negative effect of euro to dollar conversion rates and decrease in sales volume of about 4%.
- Daimler Trucks and Mercedes-Benz Vans were the two segments with positive revenue and sales volume growth.
Trend in Expenses:
- Daimler AG’s Total expenses have moved in relation to Total revenue as the Cost of Sales (highest contributor) has increased from 79.1% of Total revenue in Q1 2017 to 80.9% of Total revenue in Q1 2019.
- Net Income was affected by a lot of cost headwinds in 2018 like foreign exchange rates, Governmental proceedings, measures relating to diesel vehicles, product mix, and Inflation-related cost. In 2019 the company expects a slight improvement over the previous year.
Full Year Outlook:
- For the full year, we expect gross revenue to increase by 2.2% to $195 billion in 2019 as the company has already initiated countermeasures.
- Cost headwinds are expected to be less than previous year but EBIT is still not expected at old limits. Thus, Gross margin is expected to decrease slightly to around 25.8%.
Trefis has an estimate of $73 for Daimler AG’s stock. Growth is expected as overall revenue increases and cost headwinds reduce.
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