Frankfurt: German car and truck maker Daimler reported a 29-per cent jump in quarterly core earnings at Mercedes-Benz Cars, its biggest business, surprising investors wary of an economic slowdown and pushing its shares higher.
Mercedes posted its best-ever quarterly sales in the third quarter through September thanks to the release of new models and surging demand in China, Daimler said on Tuesday.
Carmakers selling vehicles in the United States are also benefiting from the euro’s weakening against the dollar.
Earnings before interest and tax (Ebit) from ongoing business at Mercedes-Benz Cars rose to €1.61 billion ($2.04 billion or Dh7.49 billion) in the third quarter from €1.25 billion in the year-earlier period.
Daimler said it was sticking with its 2014 forecasts for its divisions, which also include Daimler Trucks, where quarterly core earnings rose 17 per cent to €618 million.
“Finally some good news,” a local trader said, adding Daimler’s statement raised hopes for an increase in forecasts.
Shares in Daimler, which is due to publish full quarter financial results on Oct. 23, jumped on the news and were up 3.2 per cent to €58.51, at the top of Germany’s blue-chip DAX index, by 0835 GMT.
Daimler also said it would review its guidance for 2014 industrial free cash flow, a major factor when it comes to funding dividends, after the figure jumped in the third quarter.
The group has so far said it expects full-year industrial free cash flow, adjusted for acquisitions and disposals, to decline significantly from the €3.2 billion posted in 2013.
In the third quarter adjusted industrial free cash flow rose to about €2.9 billion from €1.6 billion in the year-earlier period.
