Strong sales of Mercedes luxury cars in China and the United States helped German automaker Daimler AG post a stronger than expected 57% increase in fourth-quarter profits.
Bloomberg reported that the Stuttgart-based company, parent to Mercedes-Benz Sprinter and Freightliner, made net profit of $2.36 billion during the quarter. The company also recorded a record profit for the full year, up 29% from the year before, and increased its dividend.
But it issued a cautious outlook Thursday (Feb. 9), saying next year’s profits would only equal this year’s and that the debt crisis afflicting the 17-nation eurozone would mean a flat market in Western Europe.
In 2011 though, Daimler benefited from a strong sales performance of its Mercedes luxury brand, which saw sales jump in two key markets. They were up 42% in China and 44% in the United States. Operating earnings for the division, however, rose by a more modest 5%.
The division’s strong sales performance helped overall revenue rise 10% from the fourth quarter of 2010, coming in above forecasts.
Daimler’s Mercedes van business, including its Sprinter division, and its financial services division saw strong operating profit increases. The trucks unit, including Freightliner, expects sales to increase this year on growth in the U.S. and a recovery in Japan and is targeting an average return on sales of 8% across a business cycle starting in 2013.