BMW Stock Hits On Weak Q3 Profit, Volume; Backs FY24 View

(RTTNews) - Shares of BMW Group were losing around 5 percent in the morning trade on Germany's XETRA after the luxury auto major reported Wednesday sharply lower profit and revenues for its third quarter with weak volume in all regions, mainly in China. Further, BMW Group confirmed its recently adjusted fiscal 2024 guidance.

According to the firm, delivery stops related to the supplied Integrated Brake System or IBS component caused the delivery volumes to fall significantly in the quarter.

The challenging market environment in China, despite the stimulus measures implemented by the Chinese government, amid the low consumer confidence is having a knock-on effect on sales volumes, BMW said.

Chairman of the Board of Management of BMW AG, Oliver Zipse, said, "After the extraordinary challenges in the third quarter, we are looking ahead: In the fourth quarter, we are back on track for stronger earnings in order to achieve our annual targets, despite planned high upfront expenditures. We are striking a balance between securing short-term earnings and long-term success..."

For fiscal 2024, Group earnings before taxes are still expected to decrease significantly. Vehicle deliveries in the Automotive Segment will be slightly lower than the previous year due to the ongoing low level of demand in China and delivery stops.

The share of all-electric cars relative to total deliveries will increase significantly.

The Automotive segment's EBIT margin for 2024 is forecast to be within the range of 6 percent to 7 percent.

In its third quarter, net profit plunged 83.8 percent to 476 million euros from last year's 2.93 billion euros.

Earnings per share of common stock was 0.64 euro, down 84.8 percent 4.20 euro last year.

Group earnings before tax in the third quarter declined 79.4 percent to 838 million euros from 4.06 billion euros in the prior year. Group operating profit or EBIT was 1.70 billion euros, down 61 percent from the prior year.

In the quarter, Group research and development expenditure climbed 35.4 percent year-over-year to 2.47 billion euros.

BMW Group posted revenues of 32.41 billion euros, a decline of 15.7 percent from last year's 38.46 billion euros. Adjusted for currency translation effects, revenues fell 15.3 percent.

Automotive revenues declined 13.2 percent year-over-year to 27.85 billion euros, while revenues from Motorcycles grew 8 percent and the increase was 2.5 percent in financial Services.

Automotive production volume edged up 0.3 percent from last year to 640,747 units.

Meanwhile, the premium manufacturer delivered 540,881 BMW, MINI and Rolls-Royce vehicles in the quarter, down 13 percent from last year's 621,699 automobiles.

Deliveries of BMW brand fell 11.4 percent to 487,080 units, MINI dropped 25.2 percent to 52,650 units, and Rolls-Royce fell 16.2 percent to 1,151 units.

Among regions, deliveries in Europe dropped 1 percent to 219,488 units, mainly with a 3 percent drop in Germany. In Americas, deliveries declined 10.8 percent with a 9.2 percent drop in USA. In Asia, deliveries fell 24.1 percent, with 29.8 percent fall in China.

However, BMW Group BEV deliveries grew significantly by 10.1 percent compared to the previous year, and the share of sales of fully electric vehicles rose to 19.1 percent from last year's 15.1 percent.

Motorcycles' deliveries fell 3.2 percent from last year to 50,364 units.

On Germany's XETRA, BMW shares were trading at 68.80 euros, down 5.3 percent.

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