For Daimler AG (ticker symbol DAI), 2015 was a very profitable year with the company posting record levels in all its financial metrics. Due to the contributions from all its divisions, Daimler saw significant improvements in sales and revenues, net profit, the group’s earnings before interest and tax (EBIT) as well as EBIT of all ongoing business.
The company expects to continue the trend this 2016 and is projecting further growth in revenue and EBIT from its ongoing business. Daimler expects its position in major markets to be strengthened with an overall increase in unit sales.
These projections are based on the quality offerings in all its divisions as well as their competitive pricing structure and expanded product reach, making it possible for Daimler to post higher than the expected industry-wide increase in global demand for cars.
The year 2015 was a financial success for the Daimler Group which posted its best ever EBIT at €13.5 billion compared with last year’s €10.8 billion and best EBIT from ongoing business at €13.8 billion compared with 2014’s €10.1 billion.
The group’s net profit likewise surged to €8.9 billion, a significant increase over 2014’s net profit of €7.3 billion. These improved financial performance led to a substantial increase in the company’s earnings per share which now stands at €8.08 compared with €6.51 in 2014. These latest revelations echo equally positive previous announcements made by Daimler wherein the group sold a total of 2.9 million vehicles in 2015, a 12% increase from 2014 sales.
This impressive improvement is primarily attributed to the spectacular performance of the Mercedes-Benz Cars division posting a 16% sales increase and the Mercedes-Benz Vans division increasing its sales by 9%. In contrast, the Daimler Trucks division posted a 1% lower than expected sales driven by low sales in the Latin American and Indonesian markets. However, Daimler’s €149.5 billion total revenue for 2015 is a spectacular 15% rise from the previous year.
Even when adjusted for exchange-rate effects, its revenue posted a 9% increase which is impressive by any standard. Bodo Uebber from Daimler Board of Management asserts that the company will generously share its success to its shareholders noting that there is a pending proposed dividend that has been substantially increased compared to past dividends and is reflective of the current financial success the company enjoys.
The planned dividend of €3.25 per share is higher than 2014’s dividend of €2.45 and will be proposed by the Board of Management and the Supervisory Board to Daimler’s shareholders for approval during the group’s Annual Shareholder’s Meeting this coming April 6, 2016.
Total company payout for this proposed dividend is budgeted at €3,477 and is a substantial increase from last year’s €2,621 million. Viewed from a distribution ration angle, the dividend will be 40.2% of the net profit attributable to the company’s shareholders, and is likewise higher than previous year’s ratio of 37.6%.
Daimler’s net liquidity of industrial business has likewise improved with €18.6 billion at the end of 2015 as compared to the end 2014 level of €17.0 billion. It is noteworthy to consider that the company still posted increasing liquidity despite adjustments made for its €0.7 billion acquisition of HERE, a digital mapping business in addition to the €1.2 billion contributions to Germany and U.S. pension plans. Free cash flow of the industrial base for 2015 stood at €5.9 billion -- higher than 2014’s level of €5.2 billion.