Daimler Truck continues profitable growth in Q2, confirms full-year Group guidance
Group EBIT (adj.) increased by 15 % to € 1,010 million in the reporting period (Q2 2021: € 878 million). In the Industrial Business, EBIT (adj.) of € 940 million was around 16 % higher than in the same period of the previous year (€ 810 million). The adjusted Return on Sales (RoS adj.) aggregates to 8.0 % (Q2 2021: 8.1 %).
Martin Daum, CEO of Daimler Truck: “We are in the middle of our first year as an independent company and I’d like to take the opportunity to give a big ‘Thank You’ to our global Daimler Truck team for what we have accomplished so far. With an EBIT of one billion Euros in the second quarter, our results and achievements are a strong foundation to build on. Now we want to keep this positive momentum for the second half of the year.”
Jochen Goetz, CFO of Daimler Truck: “Given the ongoing challenges with the supply chain, raw materials and energy prices we can be satisfied with our Q2 results. Our financial targets for 2022 remain unchanged. However, the current year will continue to be demanding especially on the cost side. Therefore we will stay focused on execution in all segments.”
Mercedes-Benz segment with positive special effects
The Mercedes-Benz segment achieved an EBIT (adj.) of € 512 million and a RoS (adj.) of 10.5 %. including two positive special effects. One of these positive special effects is a one-time non-cash EBIT impact of approx. € 160 million from an earlier than anticipated recording of license income for the localization of Mercedes-Benz trucks in China. Daimler Truck had previously entered into a technology license agreement with its joint venture Beijing Foton Daimler Automotive (BFDA) in the context of localizing Mercedes-Benz trucks for the Chinese market. The license agreement includes the use of defined intellectual property from Mercedes-Benz Trucks Research & Development by BFDA. In addition to the licenses, increased interest rates have resulted in another positive valuation effect from discounting of non-current liabilities.
Segments Trucks North America, Financial Services with positive contributions
Trucks North America achieved an EBIT (adj.) of € 523 million and a RoS (adj.) of 10.2 %, realizing – as expected – a much stronger second quarter with an almost balanced price/cost development. Financial Services is reporting an increased EBIT (adj.) of € 71 million due to improved interest margin in North America and improved relative cost of risk situation, leading to an adjusted Return on Equity (RoE adj.) of 15.1 %. The segment Trucks Asia was heavily impacted by considerable supply chain constraints and negative effects from our Chinese joint venture BFDA due to the depressed Chinese market. Daimler Buses had a slightly negative contribution to the Group’s overall performance, due to low demand in the coach segment.
Daimler Truck is reporting a Free Cash Flow (FCF) of minus € 756 million in Q2 (Q2 2021: € 500 million), driven by a higher inventory mostly due to ongoing constraints in the supply chain and driver shortage affecting finished trucks delivery to customers, a € 250 million contribution to the Pension Fund as part of the spin-off and significant cash taxes effective in Q2.
