Mercedes-Benz Group Q2 Results Underscore Solid Financial Performance
-
Performance: Q2 adjusted Return on Sales (RoS) reached 10.2% at Mercedes-Benz Cars and 17.5% at
Mercedes-Benz Vans ; Mercedes-Benz Mobility adjusted Return on Equity (RoE) at 8.4%. Q2 Group-EBIT reached €4.0 billion, 5% above Q1 2024. -
Cash Generation:
Mercedes-Benz Group with solid free cash flow from the industrial business of €1.6 billion. -
Transformation: Battery development capacity strengthened with new eCampus competence center for battery technologies. Roll out of Automatic Lane Change capability in
Europe . -
Share buyback update: Sustainable cash generation continued, share buyback volume reached €2.8 billion in Q2. Since the beginning of the programs in
March 2023 , the company has bought back shares equivalent to €5.1 billion as of endJune 30, 2024 . -
Outlook:
Mercedes-Benz Cars adjusted Return on Sales (RoS) expected in the range of 10% - 11%;Mercedes-Benz Vans adjusted Return on Sales guidance (RoS) seen at 14% - 15%; Mercedes-Benz Mobility’s adjusted Return on Equity (RoE) seen in the range of 8.5% - 9.5%. Guidance for Group revenue,Group EBIT and Group free cash flow from the industrial business remains unchanged.
“Thanks to our desirable passenger cars and vans, Mercedes-Benz achieved double-digit margins in a challenging environment. Going forward, we continue to invest in cutting-edge products while fostering our financial resilience. Sales and the model mix are expected to improve in the second half of the year, supported by further market launches of new models particularly in the Top-End segment.”
Ola Kaellenius, Chief Executive Officer of
|
Q2 2024 |
Q2 2023 |
Change
|
Q1-Q2
|
Q1-Q2
|
Change
|
Revenue* |
36,743 |
38,241 |
-3.9% |
72,616 |
75,757 |
-4.1% |
Earnings before Interest and Taxes (EBIT)* |
4,037 |
4,988 |
-19.1% |
7,900 |
10,492 |
-24.7% |
Net profit/loss* |
3,062 |
3,641 |
-15.9% |
6,087 |
7,652 |
-20.5% |
Free Cash Flow (industrial business)* |
1,629 |
3,363 |
-51.6% |
3,862 |
5,527 |
-30.1% |
Earnings per share (EPS) in EUR |
2.95 |
3.34 |
-11.7% |
5.81 |
7.03 |
-17.4% |
*in millions of € |
Investments, free cash flow, net liquidity
The free cash flow from the industrial business in the second quarter reached €1.6 billion (Q2 2023: €3.4 billion) due to the solid cash conversion rate at cars and vans. This was influenced by lower Earnings Before Interest and Taxes (EBIT) and headwinds in working capital development due to higher inventory levels ahead of the expected higher H2 sales. The net liquidity from the industrial business reached €28.0 billion (end of 2023: €31.7 billion) due to the dividend payment of €5.5 billion and cash outs for share buybacks of approximately €2.8 billion in the second quarter. Since the beginning of the buyback programs in
Divisional results
Adjusted Earnings Before Interest and Taxes (EBIT) at Mercedes-Benz Cars reached €2.8 billion (Q2 2023: €3.8 billion) on lower sales volumes but resulted in an adjusted Return on Sales (RoS) of 10.2%, up from 9.0% in the first quarter, (Q2 2023: 13.5%) due to a focus on sales quality in a challenging environment and due to favorable material costs.
|
Q2 2024 |
Q2 2023 |
Change
|
Q1-Q2
|
Q1-Q2
|
Change
|
Sales in units |
496,712 |
515,746 |
-3.7% |
959,690 |
1,019,229 |
-5.8% |
- thereof xEV |
89,963 |
95,910 |
-6.2% |
180,140 |
187,608 |
-4.0% |
- thereof BEV |
45,843 |
61,211 |
-25.1% |
93,364 |
112,850 |
-17.3% |
Share of xEV in unit sales in % |
18.1 |
18.6 |
- |
18.8 |
18.4 |
- |
Revenue* |
27,170 |
28,244 |
-3.8% |
52,883 |
56,056 |
-5.7% |
Earnings before Interest and Taxes (EBIT)* |
2,756 |
3,852 |
-28.5% |
5,212 |
8,000 |
-34.9% |
Earnings before Interest and Taxes (EBIT) adjusted* |
2,763 |
3,812 |
-27.5% |
5,086 |
7,925 |
-35.8% |
Return on Sales (RoS) in % |
10.1 |
13.6 |
-3.5%pts |
9.9 |
14.3 |
-4.4%pts |
Return on Sales (RoS) adjusted in % |
10.2 |
13.5 |
-3.3%pts |
9.6 |
14.1 |
-4.5%pts |
Cash Flow Before Interest and Taxes (CFBIT)* |
2,156 |
3,769 |
-42.8% |
4,453 |
6,750 |
-34.0% |
Cash Flow Before Interest and Taxes (CFBIT) adjusted* |
2,192 |
3,842 |
-42.9% |
4,533 |
6,862 |
-33.9% |
Cash Conversion Rate adjusted |
0.8 |
1.0 |
- |
0.9 |
0.9 |
- |
*in millions of € |
The adjusted Return on Sales (RoS) for
|
Q2 2024 |
Q2 2023 |
Change
|
Q1-Q2
|
Q1-Q2
|
Change
|
Sales in units |
103,435 |
119,505 |
-13.4% |
208,860 |
218,390 |
-4.4% |
- thereof BEV |
5,209 |
5,054 |
+3.1% |
8,189 |
8,624 |
-5.0% |
Share of BEV in unit sales in % |
5.0 |
4.2 |
- |
3.9 |
3.9 |
- |
Revenue* |
4,774 |
5,123 |
-6.8% |
9,667 |
9,738 |
-0.7% |
Earnings before Interest and Taxes (EBIT)* |
830 |
806 |
+3.0% |
1,763 |
1,568 |
+12.4% |
Earnings before Interest and Taxes (EBIT) adjusted* |
834 |
792 |
+5.3% |
1,634 |
1,511 |
+8.1% |
Return on Sales (RoS) in % |
17.4 |
15.7 |
+1.7%pts |
18.2 |
16.1 |
+2.1%pts |
Return on Sales (RoS) adjusted in % |
17.5 |
15.5 |
+2.0%pts |
16.9 |
15.5 |
+1.4%pts |
Cash Flow Before Interest and Taxes (CFBIT)* |
591 |
777 |
-23.9% |
1,234 |
1,187 |
+4.0% |
Cash Flow Before Interest and Taxes (CFBIT) adjusted* |
624 |
819 |
-23.8% |
1,312 |
1,269 |
+3.4% |
Cash Conversion Rate adjusted |
0.7 |
1.0 |
- |
0.8 |
0.8 |
- |
*in millions of € |
The portfolio of Mercedes-Benz Mobility shows an increasing share of xEV vehicles (battery electric vehicles and plug-in hybrid vehicles) in the second quarter of 2024. As a result, more than every second electric vehicle is now leased or financed by Mercedes-Benz Mobility. Overall, the total portfolio amounted to €135.7 billion at the end of
Mercedes-Benz Mobility |
Q2 2024 |
Q2 2023 |
Change
|
Q1-Q2
|
Q1-Q2
|
Change
|
Revenue* |
6,347 |
6,506 |
-2.4% |
13,202 |
13,145 |
+0.4% |
New business* |
14,094 |
15,415 |
-8.6% |
28,844 |
30,116 |
-4.2% |
Contract volume (June, 30)* |
135,747 |
131,375 |
+3.3% |
135,747 |
135,027** |
+0.5% |
Earnings before Interest and Taxes (EBIT)* |
271 |
172 |
+57.6% |
550 |
711 |
-22.6% |
Earnings before Interest and Taxes (EBIT) adjusted* |
271 |
448 |
-39.5% |
550 |
987 |
-44.3% |
Return on Equity (RoE) in % |
8.4 |
4.9 |
+3.5%pts |
8.5 |
10.2 |
-1.7%pts |
Return on Equity (RoE) adjusted in % |
8.4 |
12.8 |
-4.4%pts |
8.5 |
14.2 |
-5.7%pts |
*in millions of €
|
Transformation
Battery development capacity was strengthened with a new competence center for the development of cells and batteries, the so-called eCampus designed to develop innovative chemical compositions and optimized production processes for high-performance cells with “Mercedes-Benz DNA”. Furthermore, Mercedes-Benz made progress with rolling out its Automatic Lane Change function2 in
Outlook
The economic situation and automotive markets continue to be characterized by a degree of uncertainty. In addition to unexpected macroeconomic developments, uncertainties for the global economy and the business development of
The company sees unit sales of
In
In
In
The xEV share is expected to be between 19% - 20%. Sales of plug-in hybrids are expected to increase in the second half, driven by SUVs and the full availability of the E-Class.
The adjusted Return on Sales (RoS) guidance is seen in the narrower range of 10% - 11% (previously 10%-12%). Mercedes-Benz expects an increase in sales volumes and an improved model mix in the second half of the year. Mercedes-Benz also seeks to hold and defend pricing at current levels. The company sees some normalization of the used vehicle business which overall remains on a healthy level. Investments in property plant & equipment, research & development expenditure, and the adjusted Cash Conversion Rate (CCR) are seen unchanged at 0.8 to 1.0.
Due to the demanding market environment and interest rates which are remaining higher for longer, Mercedes-Benz Mobility now expects the adjusted Return on Equity (RoE) for the division in the range of 8.5% - 9.5% for the full year (previously 10%-12%). Coming from an adjusted Return on Equity (RoE) of 8.5% in H1 the company expects a flat portfolio margin in H2. Improving cost of credit risk will be partially outweighed by further increasing ramp up costs for charging infrastructure and a challenging market environment especially in
The
Link to press information “Sales figures Q2 2024”: media.mercedes-benz.com/sales
Link to capital market presentation Q2 2024: group.mercedes-benz.com/q2-2024/en
[1]
[2] MBUX Navigation is a prerequisite. The driving assistance and safety systems from Mercedes-Benz are merely aids, and do not relieve the driver of responsibility. The driver must observe the information in the Owner's Manual and the system limitations described therein.
Further information on
group-media.mercedes-benz.com and group.mercedes-benz.com
Forward-looking statements:
This document contains forward-looking statements that reflect our current views about future events. The words “anticipate”, “assume”, “believe”, “estimate”, “expect”, “intend”, “may”, “can”, “could”, “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 negative change in market conditions in our most important markets; a deterioration of our refinancing possibilities on the credit and financial markets; events of force majeure including natural disasters, pandemics, acts of terrorism, political unrest, armed conflicts, industrial accidents and their effects on our sales, purchasing, production or financial services activities; changes in currency exchange rates, customs and foreign trade provisions; changes in laws, regulations and government policies (or changes in their interpretation), particularly those relating to vehicle emissions, fuel economy and safety or to ESG reporting (environmental, social or governance topics); price increases for fuel, raw materials or energy; disruption of production due to shortages of materials or energy, labor strikes or supplier insolvencies; a shift in consumer preferences towards smaller, lower-margin vehicles; a limited demand for all-electric vehicles; a possible lack of acceptance of our products or services which limits our ability to achieve prices and adequately utilize our production capacities; a decline in resale prices of used vehicles; the effective implementation of cost-reduction and efficiency-optimization measures; the business outlook for companies in which we hold a significant equity interest; the successful implementation of strategic cooperations and joint ventures; the resolution of pending governmental investigations or of investigations requested by governments and the outcome of pending or threatened future legal proceedings; and other risks and uncertainties, some of which are described under the heading “Risk and Opportunity Report” in the current Annual Report or in this Interim Report. If any of these risks and uncertainties materializes or if the assumptions underlying any of our forward-looking statements prove to be incorrect, the 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 since they are based solely on the circumstances at the date of publication.
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Willem Spelten, +49 151 58624395, willem.spelten@mercedes-benz.com
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