euro adhoc: Bayerische Motoren Werke Aktiengesellschaft
Financial
Figures/Balance Sheet
Ad-hoc notification pursuant to Sec. 15 WpHG
Disclosure announcement transmitted by euro adhoc. The issuer is responsible for the content of this announcement.
04.11.2008
Market climate significantly deteriorated
Additional burden of approx. euro 1,3 billion in the first three
quarters
Pre-tax profit for first nine months down to euro 1,522 million
Operational improvements achieved in first nine months
Forecast for full year 2008 no longer possible due to financial crisis
Group earnings for current year expected to be clearly positive
Profitability targets for 2010 and 2012 confirmedThe knock-on effects of the international financial crisis, the downturn in the global economy, adverse exchange rate factors and high raw material prices have resulted in substantial additional expenses for the BMW Group during the third quarter and brought about a perceptible drop in revenues and earnings. The third quarter pre-tax profit was euro 279 million (third quarter 2007: euro 765 million), while the nine-month profit before tax decreased to euro 1,522 million (first nine months 2007: euro 2,682 million). In the face of a general reticence to spend by consumers, ongoing difficulties on the pre-owned car markets and increased bad debt risks, the BMW Group raised its provision for residual value risks and credit risks during the third quarter by euro 342 million. This brings the expense for risk provision recognised during the first nine months of the year to euro 1,037 million. In addition, a further euro 258 million was incurred during the period from January to September in conjunction with previously announced measures to reduce the size of the workforce.
The BMW Group has continued to achieve improvements in operational terms during the period under report, even if the generally positive progress made has been increasingly overshadowed by the impact of adverse external factors (risk provision and severance pay).
Given the prevailing difficult conditions, the likely progress of business over the coming months cannot be forecast with any exactitude. For this reason, it is not possible to predict the level of group earnings for the year, other that they will continue to be clearly positive. Previously, the BMW Group had forecast a return on sales of at least 4% for the year: this is no longer feasible given the sharp deterioration in market conditions.
The BMW Group no longer forecasts that its worldwide sales volume for the full year will be as high as the previous year´s record level. Based on the latest extrapolated figures, a further significant drop in sales volume will be recorded in October. In view of the weak state of the global economy, the BMW Group will bring production volumes into line with market demand, and in additional to the 25,000 units already announced, will cut back production for the year by at least a further 40,000 units compared to the original forecasts.
Despite difficult business conditions, the BMW Group remains committed to its long-term profitability targets. A return on sales of at least 6% is therefore still being targeted for the year 2010. This does, however, depend on the markets´ recovering. For the year 2012, the BMW Group continues to target a return on capital employed (ROCE) in excess of 26% and an EBIT margin of between 8% and 10% in its Automobile segment.
Further inquiry note:
Bill McAndrews Tel.: +49 (0) 89 382 22332 E-Mail: Bill.McAndrews@bmw.de
Marc Hassinger Tel.: +49 (0) 89 382 23362 E-Mail: Marc.Hassinger@bmw.de
end of announcement euro adhoc
Further inquiry note:
Susanne Meis
Tel.: +49(0)89 382 33005
E-Mail: susanne.meis@bmw.de
Branche: Automotive Equipment
ISIN: DE0005190003
WKN: 519000
Index: DAX, CDAX, HDAX, Prime All Share
Börsen: SWX Swiss Exchange / Hauptsegment
Börse Frankfurt / regulated dealing/prime standard
Börse Berlin / regulated dealing
Börse Hamburg / regulated dealing
Börse Stuttgart / regulated dealing
Börse Düsseldorf / regulated dealing
Börse Hannover / regulated dealing
Börse München / regulated dealing