German luxury carmaker BMW reported weak net profits in the second quarter on Thursday despite strong day-to-day business.
The Munich-based carmaker reported that pre-tax profits increased with higher revenues even as overall profits dropped, mainly due to higher taxes.
Sales for BMW climbed 7% to €37.2 billion because BMW sold more cars – and more expensive high-end models accounted for a larger share of sales as well.
BMW had already presented key data on its operating business on Tuesday, raising its annual outlook for sales and for the profit margin before interest and taxes in car manufacturing.
Automotive segment deliveries grew 11.3% to 626,726 units and motorcycles deliveries grew 8% to 64,936 units.
However, the BMW Group said it also needs more money for investments in electric drivetrains as well as for higher inventories than previously estimated, which disappointed investors.
For the quarter, BMW’s net profits dropped 2.9% to €2.96 billion ($3.23 billion) from last year’s €3.05 billion. Earnings per share decreased 2.1% to €4.39 from €4.30 euros a year ago.
Profit before tax grew 7.5% from last year to €4.22 billion, and earnings before interest, taxes (EBIT) climbed 26.8% to €4.34 billion. Group revenues increased 7% to €37.22 billion from prior year’s €34.77 billion.
BMW projected profits for the year to be down compared to last year – mainly because of last year’s one-time gain of €7.7 billion reimbursement of the BMW Group’s previous at-equity interest in BMW Brilliance.
Source: Ghana News Agency