Daimler shares sink after third profit warning this year
Daimler’s share price fell more than three per cent this morning after issuing a third profit warning this financial year.
The Mercedes-Benz manufacturer warned investors that investigations into diesel vehicles is likely to hit profits by a “high three-digit million euro amount”.
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The car maker now expects 2019 earnings before interest, taxes, depreciation and amortisation (Ebitda) to fall in line with the €11.1bn of the previous year.
Previously it predicted a slight rise in earnings.
Shares dropped 3.9 per cent in early morning trading to €47.9 per share.
The drop also hit BMW and Volkswagen’s stock prices.
“Relevant for the reassessment is an increase in expected expenses in connection with various ongoing governmental proceedings and measures with regard to Mercedes-Benz diesel vehicles,” Daimler said.
Daimler revealed it must recall 60,000 Mercedes diesel cars in Germany yesterday after regulators found they ran software designed to deliver false emissions tests.
Daimler is already being investigated in Europe and the US over diesel emissions, and an October profit warning also related to diesel concerns.
BMW, Daimler and Volkswagen have all been charged with conspiring to block the introduction of clean emissions technology.
Yesterday Daimler also warned it expects a sales return on Mercedes vans of between minus two and minus four per cent.
That is a drop compared to its previous estimate of a return of up to two per cent.
Last October Daimler told shareholders the automotive sector was operating in a “very challenging environment”, and saw first quarter operating profit fall 16 per cent to €2.8bn.
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At the time, now-retired CEO Dieter Zetsche said: “Based on our sales planning and the countermeasures we have already initiated, we are confident that we will achieve those targets.”
In February the company again warned of “difficult political and economic conditions”.