BMW AG predicted only a slight increase in deliveries, taking a cautious approach for a year when it risks losing its lead in the luxury-car market to Mercedes-Benz.
The carmaker also disappointed some investors by not offering a special dividend as it celebrates its 100th anniversary. BMW said Wednesday it plans yet again to raise the general dividend to 3.20 euros per common share from 2.90 euros for 2014 earnings, which would be its sixth increase in a row. The shares fell as much as 3.2 percent.
An aging model lineup has left BMW struggling to keep pace with No. 2 Mercedes, which has rolled out a slate of new vehicles in recent years including the GT sports car, GLE Coupe crossover and compact CLA sedan. Chief Executive Officer Harald Krueger pointed to just a single fresh car, the 7-Series sedan, to help boost sales.
“BMW certainly knows it’s under pressure to show they can regain growth momentum, and they need to find a way to return passion to the brand,” said Arndt Ellinghorst, a London-based analyst with Evercore ISI.
The shares traded down 1.7 percent to 78.66 euros at 3:16 p.m. in Frankfurt. BMW has lost 20 percent this year, more than the 15 percent decrease in Mercedes parent Daimler AG’s shares.
Paring Back
BMW’s muted outlook compares to a forecast of sales growth at this time last year. The carmaker follows Mercedes’s cautious tone amid what it called a politically and economically volatile environment. The forecast comes as BMW reported fourth-quarter improvement in earnings and profitability, with a margin of 9.6 percent of sales from carmaking, up from 8.2 percent a year earlier.
Earnings before interest and taxes rose 5.2 percent to 9.59 billion euros ($10.5 billion) from 9.12 billion euros a year earlier, the company said in an e-mailed statement. The figure was in line with the 9.56 billion-euro average of 20 analyst estimates compiled by Bloomberg. Full-year net income increased 10 percent to 6.4 billion euros.
The carmaker is scheduled to release full 2015 earnings details on March 16. Krueger will also give a broader strategy update, his first as CEO.
By: Elisabeth Behrmann.
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