Mercedes-Benz Delivers Strong Full Year Results In 2022
02/17/2023 - 01:36 AM
Profitable growth: Group EBIT substantially improved by 28% to €20.5 billion (2021: €16.0 billion ) as revenue increased by 12% to €150.0 billion (2021: €133.9 billion )
Resilient operations: Mercedes-Benz Cars adjusted Return on Sales (RoS) reaches 14.6% (2021: 13.1% ), 11.2% for Mercedes-Benz Vans (2021: 8.3% ), and an adjusted Return on Equity (RoE) of 16.8% for Mercedes-Benz Mobility (2021: 22.0% ) despite macro challenges
Transformation continues: Announced global charging network, realigned production network to scale EVs, Level 3 conditionally automated driving approved in Nevada , new partnerships for sourcing raw materials and semiconductors established
Dividend increased: Proposal of €5.20 (2021: €5.00)
Share buyback: Shares worth up to €4 billion to be repurchased over 2 years
Outlook 2023: Group revenue expected at prior-year level, EBIT seen slightly below 2022 level, Free Cash Flow (Industrial Business) at prior-year level, Mercedes-Benz Cars adjusted RoS seen in the range of 12% -14% , Mercedes-Benz Vans adjusted RoS seen at 9% -11% and Mercedes-Benz Mobility adjusted RoE at 12% -14%
STUTTGART, Germany --(BUSINESS WIRE)--
Mercedes-Benz Group AG’s (ticker symbol: MBG) sharpened focus on high-end passenger cars and premium vans, combined with tight cost control, helped to lift Earnings Before Interest and Taxes (EBIT) by 28% to €20.5 billion (2021: €16.0 billion ) last year, outpacing a 12% rise in revenue to €150.0 billion (2021: €133.9 billion ) during the same period.
In its first year after the Daimler Truck spin-off, Mercedes-Benz Group continued its transformation amid geopolitical and macroeconomic challenges. Strong results underline the improved profitability, even as the COVID-19 pandemic and semiconductor supply-chain bottlenecks and the fallout from Russia’s war against Ukraine continued to affect the business.
”We have redesigned Mercedes-Benz to be a more profitable company thanks to our focus on desirable products and disciplined margin and cost management. We cannot control macro or world events, but 2022 is a case in point that we are moving in the right direction,” said Ola Kaellenius, Chief Executive Officer of Mercedes-Benz Group AG .
“In addition to delivering strong financial results, the team accelerated our pace as a technology leader in electric and automated driving. The next chapter in our transformation will be revealed during the Mercedes-Benz Strategy Update in California on February 22 focusing on the Mercedes-Benz Operating System (MB.OS).“
Mercedes-Benz Group *
Q4 2022
Q4 2021
Change
22/21
FY
2022
FY
2021
Change
22/21
Revenue**
41,003
35,240
+16%
150,017
133,893
+12%
EBIT**
5,411
4,115
+31%
20,458
16,028
+28%
EBIT adjusted**
5,071
5,044
+1%
20,655
17,158
+20%
Net profit/loss**
4,027
2,477
+63%
14,809
11,050
+34%
Free cash flow (industrial business)**
2,479
1,421
+74%
8,128
7,880
+3%
Free cash flow (industrial business) adjusted**
2,706
1,615
+68%
9,294
10,125
-8%
Earnings per share (EPS) in EUR
3.72
2.24
+66%
13.55
10.00
+35%
* from continuing operations
** in millions of €
Transformation accelerated
Hungary . An annual supply agreement for an average 10,000 tons of lithium hydroxide from Canadian-German start-up Rock Tech Lithium Inc. was signed. In addition, Mercedes-Benz announced plans to launch a global high-power charging network across North America , Europe , China and other key markets.
Investments, free cash flow and liquidity
€8.1 billion (2021: €7.9 billion ). The net liquidity of the industrial business rose to €26.6 billion (end of 2021: €21.0 billion ). The Group’s investments in property, plant and equipment in the full year totaled €3.5 billion (2021: €4.6 billion *). Research & development expenditure amounted to €8.5 billion (2021: €9.1 billion *).
*In 2021, Daimler’s commercial vehicle business is included until the time of the spin-off and hive-down
Divisional results
Mercedes-Benz Cars 5% ). In line with the strategy to focus on EVs, Mercedes-Benz had strong BEV sales of 149,227 units incl. smart (+67% ). Sales in the Top-End segment increased by 8% driven by the S-Class (+6% ) and additionally its all-electric version EQS, with more than 23,400 vehicles sold. Q4 marked the best sales quarter for this all-electric flagship. Furthermore, Mercedes-Maybach achieved a new record year with sales up 41% . Strong sales of C-Class, the top-seller GLC and the new EQE led to a rise in sales in the Core segment of 9% . The adjusted Return on Sales (RoS) for Mercedes-Benz Cars rose to 14.6% from 13.1% in the year-earlier period.
In the fourth quarter, deliberate decisions to make payments to selected suppliers and the impact of the so-called “inflation bonus” for eligible staff in Germany resulted in slight headwinds and an adjusted Return on Sales of a still high 13.4% .
Mercedes-Benz Cars
Q4 2022
Q4 2021
Change
22/21
FY
2022
FY
2021
Change
22/21
Sales in units
536,181
500,421
+7%
2,040,719
1,943,930
+5%
-thereof xEV
111,046
89,161
+25%
333,490
271,847
+23%
-thereof BEV
53,539
31,676
+69%
149,227
89,571
+67%
Revenue*
30,557
25,380
+20%
111,601
96,712
+15%
EBIT*
4,243
3,838
+11%
16,340
12,487
+31%
EBIT adjusted*
4,088
3,988
+3%
16,245
12,689
+28%
Return on Sales (RoS) in %
13.9
15.1
-1.2% pts
14.6
12.9
+1.7% pts
Return on Sales (RoS) adjusted in %
13.4
15.7
-2.3% pts
14.6
13.1
+1.5% pts
Cash Flow Before Interest and Tax (CFBIT)*
3,104
1,533
+102%
10,718
9,344
+15%
Cash Flow Before Interest and Tax (CFBIT) adjusted*
3,233
1,646
+96%
11,413
10,714
+7%
Cash Conversion Rate adjusted
0.8
0.4
-
0.7
0.8
-
*in millions of €
At Mercedes-Benz Vans 8% ), thanks to a comprehensive portfolio of commercial and private vans, despite the ongoing global challenges in the areas of parts supply and logistics. In the year under review, 15,000 eVans were sold (+15% ), thereof around two thirds commercial eVans. The adjusted Return on Sales (RoS) for Mercedes-Benz Vans rose to 11.2% (2021: 8.3% ). In 2022, the all-electric small vans eCitan and EQT [power consumption combined (WLTP): 18.99 kWh/100 km; combined CO2 emissions (WLTP): 0 g/km], were presented, so that the entire product range is fully electric. A few days ago the eSprinter had its world premiere.
Mercedes-Benz Vans
Q4 2022
Q4 2021
Change
22/21
FY
2022
FY
2021
Change
22/21
Sales in units
122,733
111,499
+10%
415,344
386,239
+8%
Revenue*
5,114
4,122
+24%
17,217
14,735
+17%
EBIT*
670
256
+162%
1,897
1,143
+66%
EBIT adjusted*
501
294
+70%
1,927
1,229
+57%
Return on Sales (RoS) in %
13.1
6.2
+6.9% pts
11.0
7.8
+3.2% pts
Return on Sales (RoS) adjusted in %
9.8
7.1
+2.7% pts
11.2
8.3
+2.9% pts
Cash Flow Before Interest and Tax (CFBIT)*
665
519
+28%
1,731
826
+110%
Cash Flow Before Interest and Tax (CFBIT) adjusted*
740
592
+25%
2,039
1,581
+29%
Cash Conversion Rate adjusted
1.5
2.0
-
1.1
1.3
-
*in millions of €
Mercedes-Benz Mobility saw new business decline to €58.0 billion (2021: €63.6 billion ). However, the prior-year figure still included the new business from Daimler Trucks & Buses prior to the Daimler commercial vehicle business spin-off. At the end of 2022, contract volume amounted to €132.4 billion and was thus at the same level as at the end of last year (2021: €133.7 billion ). For financed and leased electric and hybrid vehicles, Mercedes-Benz Mobility was able to significantly increase its contract volume, compared to end of last year. Overall, in 2022 adjusted EBIT decreased to €2.4 billion (2021: €3.4 billion ), driven by the increase in cost of credit risk caused by a subdued economic outlook as well as higher refinancing costs and lower volumes following to the Daimler Truck spin-off. Consequently, adjusted Return on Equity (RoE) was below the last year’s level with 16.8% (2021: 22.0% ).
Mercedes-Benz Mobility
Q4 2022
Q4 2021
Change
22/21
FY
2022
FY
2021
Change
22/21
Revenue*
6,858
7,246
-5%
26,954
27,941
-4%
New business*
15,121
15,043
+1%
58,031
63,631
-9%
Contract volume (December, 31)*
132,379
133,687
-1%
132,379
133,687
-1%
EBIT*
494
882
-44%
2,428
3,493
-30%
EBIT adjusted*
494
885
-44%
2,428
3,449
-30%
Return on Equity (RoE) in %
14.0
21.6
-7.6% pts
16.8
22.3
-5.5% pts
Return on Equity (RoE) adjusted in %
14.0
21.7
-7.7% pts
16.8
22.0
-5.2% pts
*in millions of €
Dividend and share buyback
At the Annual General Meeting on May 3, 2023 , the Board of Management and the Supervisory Board will propose a dividend of €5.20 per share (2021: €5.00) . For 2022 the total payout would amount to €5.6 billion (2021: €5.35 billion ).
To optimise the company’s capital structure and to create value for shareholders, Mercedes-Benz announced a share buyback to repurchase own shares worth up to € 4 billion (not including incidental costs) on the stock exchange over a period of up to two years. The repurchased shares shall subsequently be cancelled. On the back of strong operating performance and continued strong cash generation the programme is scheduled to start in March 2023 . The buyback will be funded by Mercedes-Benz’s expected future excess free cash flow and is fully compatible with the company’s strategic priorities and its dividend policy. Mercedes-Benz remains committed to a strong investment grade credit rating and targets an A rating by the major agencies. Further details on the share buyback programme will be announced separately prior to the start of the programme.
Outlook
Ukraine , the development of trade between China the European Union and the United States , and the further course of the COVID-19 pandemic. These may impact supply chains and the development of prices for raw materials and energy. In addition, continued inflationary pressure for consumers and companies and the associated central bank increases in interest rates, as well as a more pronounced growth slowdown in the economy, make the outlook more difficult. The worldwide shortage of semiconductors is easing, however individual issues remain, causing supply constraints.
Overall demand : In Europe, incoming orders are more sluggish, however the order bank supports sales into the first half of the year. In the United States , demand is seen on a good level. In China , the fourth-quarter COVID-19 effect has led to a spill over impact on sentiment in the first quarter. Momentum is seen returning post Chinese New Year , preliminary indications show.
Sales guidance : The company is taking a prudent view and sees unit sales of Mercedes-Benz Cars 12% to 14% . Net pricing is expected to be slightly positive. Based on current assumptions it is targeted to compensate inflation-related cost increases, supply chain interruptions and one-time commodity charges. The used vehicle business is expected to be slightly negative versus 2022. Research & Development spending is expected to be slightly above the prior year. Investments in property plant & equipment are seen significantly above, mainly due to the MMA platform.
Total Mercedes-Benz Vans 9% to 11% . Net pricing is expected to remain flat. Based on current assumptions, it is targeted to compensate inflation-related cost increases, supply chain interruptions, and one time commodity charges. Investment in property, plants & equipment and research & development spending are seen significantly above the prior-year level due to investments into the VAN.EA electric platform.
The portfolio volume of Mercedes-Benz Mobility is seen slightly lower. The adjusted Return on Equity is seen in the range of 12% to 14% for 2023. This includes Operational Expenditures (OpEx) increases of the recently announced charging network.
The Mercedes-Benz Group Mercedes-Benz Group expects the Free Cash Flow of the industrial business at the previous year's level in 2023. Higher tax payments are expected than in the previous year.
The Mercedes-Benz Group expects the average CO2 fleet of new passenger cars in Europe (European Union , Norway and Iceland ) for 2023 to decline significantly compared to the previous year. With the further expansion of the fleet of electric vehicles, it can be assumed that the CO2 requirements in Europe will also be met in 2023.
Link to press release “Sales figures 2022”:
Mercedes-Benz Cars : group-media.mercedes-benz.com/annual sales/cars
Mercedes-Benz Vans : group-media.mercedes-benz.com/annual sales/vans
Link to capital market presentation on full year 2022: group.mercedes-benz.com/results-2022
Pictures of the Annual Results Conference 2022 will be available here: group-media.mercedes-benz.com
Further information on Mercedes-Benz Group AG is available at:
group-media.mercedes-benz.com andgroup.mercedes-benz.com
The figures in this document are preliminary and have neither been approved yet by the Supervisory Board nor audited by the external auditor.
Forward-looking statements:
This document contains forward-looking statements that reflect our current views about future events. The words “anticipate,” “assume,” “believe,” “estimate,” “expect,” “intend,” “may,” ”can,” “could,” “plan,” “project,” “should” and similar expressions are used to identify forward-looking statements. These statements are subject to many risks and uncertainties, including an adverse development of global economic conditions, in particular a decline of demand in our most important markets; a deterioration of our refinancing possibilities on the credit and financial markets; events of force majeure including natural disasters, pandemics, acts of terrorism, political unrest, armed conflicts, industrial accidents and their effects on our sales, purchasing, production or financial services activities; changes in currency exchange rates, customs and foreign trade provisions; a shift in consumer preferences towards smaller, lower-margin vehicles; a possible lack of acceptance of our products or services which limits our ability to achieve prices and adequately utilize our production capacities; price increases for fuel raw materials or energy; disruption of production due to shortages of materials or energy, labour strikes or supplier insolvencies; a decline in resale prices of used vehicles; the effective implementation of cost-reduction and efficiency-optimization measures; the business outlook for companies in which we hold a significant equity interest; the successful implementation of strategic cooperations and joint ventures; changes in laws, regulations and government policies, particularly those relating to vehicle emissions, fuel economy and safety; the resolution of pending governmental investigations or of investigations requested by governments and the outcome of pending or threatened future legal proceedings; and other risks and uncertainties, some of which are described under the heading “Risk and Opportunity Report” in this Annual Report. If any of these risks and uncertainties materializes or if the assumptions underlying any of our forward-looking statements prove to be incorrect, the actual results may be materially different from those we express or imply by such statements. We do not intend or assume any obligation to update these forward-looking statements since they are based solely on the circumstances at the date of publication.
Mercedes-Benz Group at a glance
Mercedes-Benz Group AG is one of the world's most successful automotive companies. With Mercedes-Benz AG , the Group is one of the leading global suppliers of high-end passenger cars and premium vans. Mercedes-Benz Mobility AG offers financing, leasing, car subscription and car rental, fleet management, digital services for charging and payment, insurance brokerage, as well as innovative mobility services. The company founders, Gottlieb Daimler and Carl Benz , made history by inventing the automobile in 1886. As a pioneer of automotive engineering, Mercedes-Benz sees shaping the future of mobility in a safe and sustainable way as both a motivation and obligation. The company's focus therefore remains on innovative and green technologies as well as on safe and superior vehicles that both captivate and inspire. Mercedes-Benz continues to invest systematically in the development of efficient powertrains and sets the course for an all-electric future: The brand with the three-pointed star pursues the goal to go all-electric by 2030, where market conditions allow. Shifting from electric-first to electric-only, the world’s pre-eminent car company is accelerating toward a fully electric and software-driven future. The company's efforts are also focused on the intelligent connectivity of its vehicles, autonomous driving and new mobility concepts as Mercedes-Benz regards it as its aspiration and obligation to live up to its responsibility to society and the environment. Mercedes-Benz sells its vehicles and services in nearly every country of the world and has production facilities in Europe , North and Latin America , Asia and Africa . In addition to Mercedes-Benz, the world's most valuable luxury automotive brand (source: Interbrand study, 03 Nov. 2022 ), Mercedes-AMG, Mercedes-Maybach, Mercedes-EQ and Mercedes me as well as the brands of Mercedes-Benz Mobility: Mercedes-Benz Bank , Mercedes-Benz Financial Services and Athlon. The company is listed on the Frankfurt and Stuttgart stock exchanges (ticker symbol MBG). In 2022, the Group had a workforce of around 170,000 and sold around 2.5 million vehicles. Group revenues amounted to €150.0 billion and Group EBIT to €20.5 billion .
View source version on businesswire.com : https://www.businesswire.com/news/home/20230216005838/en/
Tobias Just , +49 711 17 41341, tobias.just@mercedes-benz.com
Edward Taylor , +49 176 30 94 1776, edward.taylor@mercedes-benz.com
Benjamin Kraft , +49 176 3095 7277, benjamin.b.kraft@mercedes-benz.com
Andrea Berg , +917 667 2391, andrea.a.berg@mercedes-benz.com
Source: Mercedes-Benz Group AG
