Second-quarter results released yesterday by German luxury car maker BMW underscored the change in fortunes seen by high end auto groups in the past year, with a net profit that was seven times stronger.
The world’s leading premium auto manufacturer said net profit climbed to 834 million euros (US$1.1 billion) from 121 million euros in the same period a year earlier.
Analysts polled by Dow Jones Newswires had forecast a slightly more modest figure of 674 million euros.
“The evident market recovery since the beginning of the year continued to gain pace during the second quarter 2010,” a sober BMW statement said.
The group delivered 380,412 BMW, MINI and Rolls-Royce vehicles in the period, an annualized gain of 12.5 percent, and posted an 18.3 percent jump in sales to 15.348 billion euros.
Operating earnings before interest and tax soared to 1.717 billion euros from just 169 million euros in what was admittedly an extremely weak second quarter last year.
On a six-month basis, BMW swung from a loss of 31 million euros in the first half of last year to a profit of 1.158 billion euros this time around.
Luxury car makers have seen a complete turnaround this year, with emerging countries like China helping them put a horrid 2009 well behind.
Looking ahead to the rest of this year, BMW said unit sales should gain around 10 percent to more than 1.4 million vehicles and profit margins on core operations were expected to be “more than 5 percent for the automobiles segment.”
That is expected to climb to between eight to 10 percent by 2012.
The group is counting on strong demand for its new 5-series models as well as new generations of its X3 sports utility vehicle and MINI cars.
BMW motorcycles also did well, “despite unfavorable market conditions,” with a 21.6 percent rise in sales to 36,175 units. The financial services division sold 3 percent more contracts as well.
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