BMW posts 13 percent drop in second-quarter automotive EBIT
BERLIN/FRANKFURT (Reuters) - German luxury carmaker BMW (BMWG.DE) said second-quarter operating profit in its key automotive division fell in line with expectations, due to increased spending on fuel-efficient technology and discounts in embattled European markets.
The company said on Thursday that the segment's earnings before interest and tax (EBIT) dropped 13 percent to 1.76 billion euros ($2.3 billion), matching the 1.77 billion euro consensus forecast in a Reuters poll.
This reduced its automotive EBIT margin by 2 percentage points to 9.6 percent in the quarter, but it remained substantially higher than the 6.9 percent achieved by Daimler's (DAIGn.DE) Mercedes-Benz.
"The BMW Group achieved a strong second-quarter performance despite the headwinds on many automobile markets in Europe," Chief Executive Norbert Reithofer said in a statement, adding its automotive margin was "at the top end of our targeted range".
While BMW stuck to its forecast for an automotive EBIT margin between 8 and 10 percent this year and group pretax profit on a similar level as last year's 7.82 billion, it cautioned that increased competition would continue to create challenges in the second half.
BMW, the only one of Germany's three big automakers including Daimler and VW (VOWG_p.DE) that hasn't scaled back profit ambitions this year, is counting on new models including the overhauled 5-Series saloon, the next generation of the X5 SUV and the 4-Series coupe to keep up its sales momentum.
(Reporting by Andreas Cremer and Christiaan Hetzner; Editing by Christoph Steitz and David Holmes)
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