BMW Group on course for successful financial year


Munich.

As set out in its Strategy NUMBER ONE
NEXT
, the BMW Group is committed to playing a key role in
tomorrow’s mobility and is investing substantially in new
technologies. Against this background, the Group can report after
the first three quarters that it remains firmly on track to complete
a highly successful financial year 2017. Through sustainable
profitability, the BMW Group is strengthening the position of
Germany as a centre of expertise and driver of innovation for
tomorrow’s mobility and technologies. As the world’s leading
provider of premium mobility, the BMW Group always focuses on the
needs and desires of its customers and is continuing its
ground-breaking work on the four ACES topics
(Autonomous, Connected,
Electrified and Services/Shared).

 

“We are resolutely doing things the BMW way, keeping our
promises and raising the bar for our own ambitious targets,”
stated Harald Krüger in Munich on Tuesday. “We
are investing substantially in tomorrow’s mobility, enabling us to
maintain our leading position of innovation and sustainable
employment. In this way, we remain a dependable partner for society,
policymakers and the environment as well as one of the most
attractive employers worldwide.”

 

The BMW Group is currently investing 400 million euros in the
large-scale expansion of its Research and Innovation centre (FIZ) in
Munich to create an innovative working environment for around 5,000
employees by 2019. Additionally, from 2021 onwards, the BMW iNEXT
will set new standards in terms of electric mobility, automated
driving and connectivity, thereby further enhancing the Dingolfing
production plant. A
s the BMW Group’s centre of competence for
electric mobility, Plant Dingolfing already supplies components to the
company’s production network.

 

In the third quarter, the first employees moved to the new
Autonomous Driving Campus near Munich and are now working there hand
in hand with partners from Intel and Mobileye on the continued
development of autonomous driving. With Fiat Chrysler Automobiles as
well as Delphi, Continental and Magna, four additional partners are
already collaborating to create a non-exclusive platform for
autonomous driving. “These developments underline the success
story that has been evolving over the past year with the unique
cooperation arrangements and provide additional impetus to embark on
the next steps,” said Krüger.

 

With its Strategy
NUMBER ONE NEXT, the BMW Group has shown its
clear technological focus on electric mobility, digitalisation and
autonomous driving. By 2025, the BMW Group intends
to offer 25 models across all of its brands,
featuring either all-electric propulsion or plug-in hybrid
solutions. The fifth generation of storage and powertrain technology
is set to provide up to 700 kilometres of range for
all-electric vehicles and up to 100 kilometres for
plug-in hybrid models.

 

“Around a decade ago, we anticipated the
‘iconic change’ and we put forward a clear strategy –
far ahead of our competitors,” stated Krüger. “We
remain on track to deliver more than
100,000 electrified vehicles in the current
year
.” Crucial for the long-term transition from combustion
engines to e-mobility is the flexibility factor, as technological
change is likely to take place at various speeds, depending on the
region and the respective regulatory regimes. The BMW Group is
therefore fully committed to flexible architectures
and modules. The combination of new vehicle architectures and
flexible production facilities will enable quick decisions to be
made on how many of which models should be produced and with which
drive systems.

 

At the IAA in Frankfurt, the BMW Group revealed the
BMW i Vision Dynamics, an emotional symbol for the
future of e-mobility in the form of a four-door Gran Coupé.
“With this concept vehicle, we are electrifying the very heart
of the BMW brand and raising BMW i to a new dimension at the same
time,” stated Krüger. “We will build this
model at our Munich plant, thereby highlighting Germany’s importance
as a location for electric mobility.”

 

A successful core business, geared to generating long-term
profitability, remains the backbone of the BMW Group, providing the
underlying strength to determine the shape of mobility going
forward. The BMW Group recorded volume, revenue and earnings growth
in the first nine months of 2017. The new BMW 5
Series
, along with other models, contributed to this
success, impressing customers and experts alike. Its launch in
February 2017 marked the start of the largest model offensive in the
BMW Group’s history.

 

Some forty new and updated models of the Group’s three premium
brands, BMW, MINI and Rolls-Royce, will be brought to market during
the current and the following year. Through the addition of vehicles
with great emotional appeal within the upper-premium segment such as
the new BMW 8 Series, the BMW Group aims to achieve significant
volume growth in this segment by 2020. The segment also includes the
BMW 7 Series and the future BMW X7. This forms part of the company’s
strategy of strengthening the performance side in order to ensure
long-term business success.

 

“Sustainable profitability remains a key element of Strategy
NUMBER ONE NEXT by providing us with the underlying strength to
help shape mobility of the future. Significant upfront investment on
research and development is therefore necessary, both now and in the
coming years,” explained Nicolas Peter, Member of
the Board of Management of BMW AG, Finance. “We are investing
extensively in the future of the BMW Group and rigorously following
a strategy of achieving success on a sustainable basis. To this end,
we are systematically reducing process and product complexity on a
daily basis and optimizing our product and service range to meet the
needs of customers. In this way, we will ensure the consistency and
reliability of the BMW Group.”


 


BMW Group achieves revenue and earnings growth in the year-to-date

 

Deliveries of BMW, MINI and Rolls-Royce brand vehicles in the
third quarter 2017 increased by 1.2% to 590,415
units (2016: 583,499 units). Held down by currency factors,
Group revenues totalled € 23,424 million,
slightly up on the previous year (€ 23,362 million; +0.3%). As
expected, increased costs in the third quarter dampened earnings. At
€ 2,304 million, profit before financial result
(EBIT) for the three-month period was slightly down on the previous
year, influenced by significantly higher investments, as well as
expenses for research and development (2016: € 2,380 million;
-3.2%). Third-quarter profit before tax (EBT)
amounted to € 2,422 million (2016: € 2,575 million; -5.9%),
resulting in an EBT margin of 10.3% (2016: 11.0%).
Group net profit amounted to € 1,789 million
(2016: € 1,821 million; -1.8%).

 

Automobile deliveries in the first nine months
increased by 3.7% to 1,811,234 units (2016: 1,746,638
units). Group revenues grew by 5.0% to € 72,671
million (2016: € 69,229 million). Profit before financial
result
(EBIT) climbed by 4.2% to € 7,879 million (2016:
€ 7,562 million). Group profit before tax (EBT)
amounted to € 8,482 million (2016: € 7,741 million), 9.6% up on the
previous year. The EBT margin came in at 11.7%
(2016: 11.2%). Group net profit increased by 13.7%
to € 6,152 million (2016: € 5,411 million).


 


Automotive segment: EBIT margin within target range

 

At € 21,040 million, third-quarter
Automotive segment revenues were slightly down on
the previous year (€ 21,564 million; -2.4%). EBIT
also fell slightly to € 1,753 million (2016: € 1,837 million;
-4.6%). The segment EBIT margin came in at 8.3%
(2016: 8.5%) and therefore within the target range of between 8 and
10%. Profit before tax amounted to € 1,880 million
(2016: € 2,030 million; -7.4%).

 


Nine-month Automotive segment revenues

totalled € 64,708 million (2016: € 63,250 million; +2.3%).
EBIT also rose slightly to € 5,862 million (2016:
€ 5,778 million; +1.5%). The EBIT margin remained
at 9.1%. Profit before tax increased by 8.3% to
€ 6,544 million (2016: € 6,041 million).

 

Deliveries of BMW brand vehicles worldwide totalled
1,537,497 units (2016: 1,479,936; +3.9%), surpassing the 1.5 million
mark for the first time in the first three quarters of a financial
year. Volume growth was driven by a variety of models including the
BMW Group’s flagship BMW 7 Series, and the BMW X-family models. Nearly
48,000 units of the BMW 7 Series were delivered to
customers during the first nine months of 2017, 14.7% more than one
year earlier. Deliveries of the BMW X1 rose in this
period by 38.7% to more than 200,000 units. The
BMW X5 deliveries increased by 7.2% to over 130,000
units. In China, the new generation of the BMW 5
Series
is still in model changeover. Outside China,
deliveries are already well above the previous year’s level: in
September, the increase was 48.8%. The growing availability of the
5 Series should generate additional momentum as the year progresses.

 

Deliveries of 271,394 units during the first nine months of the year
also represented a new record for the MINI brand
(2016: 264,077 units; +2.8%). Deliveries of the MINI Countryman in
this period totalled 57,256 units (2016: 51,491 units; +11.2%). The
new MINI Convertible also saw significant volume growth to 26,665
units (2016: 23,217 units; +14.9% units).

 

The Goodwood-based Rolls-Royce brand delivered 2,343
(-10.7%) cars to customers in the first three quarters of the year.
This result takes into account the current absence of Phantom from the
market, pending first customer deliveries of New Phantom in January
2018, and challenging market conditions within the global luxury
sector in a number of regions around the world. Significant
rebalancing of the company’s manufacturing plant in preparation for
new models has proceeded throughout this period. New Phantom was
unveiled in July in London to worldwide acclaim and already has a
strong order book.

 

In line with its strategy of achieving a well-balanced distribution
of sales worldwide, the BMW Group uses its highly flexible production,
sales and marketing structures to even out fluctuating demand between
individual regions. In Europe, the BMW Group recorded
volume growth of 1.1%, delivering 816,233 units in the first nine
months of the year (2016: 807,597 units), despite the recent headwinds
affecting a number of key markets.

 

The BMW Group achieved significant growth during the nine-month
period in Asia, with deliveries rising to 621,203
units (2016: 548,986 units; +13.2%). This performance was driven
primarily by China, where the number of BMW Group vehicles delivered
grew by 15.2% to 437,111 units (2016: 379,461 units).

 

Volume performance in the Americas region was held
down by the contracting automobile market in the USA, with deliveries
in the nine-month period falling by 3.4% to 326,589 units (2016:
338,005 units). By contrast, a double-digit percentage increase was
reported in Mexico and Latin America during the period from January to September.

 


Motorcycles segment records highest delivery volume figure to date

 

The Motorcycles segment performed extremely
well in the third quarter. Deliveries to customers
in the period from July to September rose by 11.7% to 39,429 units
(2016: 35,290 units). Accordingly, revenues grew by
14.0% to € 514 million (2016: € 451 million). Profit before
financial result
was significantly higher at € 53 million
(2016: € 32 million; +65.6%), resulting in an EBIT
margin
of 10.3% (2016: 7.1%). Profit before
tax
for the third quarter improved to € 53 million (2016:
€ 32 million; +65.6%).

 

During the first nine months of the year, a
total of 127,818 BMW motorcycles and maxi-scooters were delivered to
customers (2016: 116,044 units; +10.1%). Revenues
grew by 11.1% to € 1,833 million (2016: € 1,650 million).
Profit before financial result improved
significantly, rising by 25.9% to € 282 million (2016: € 224
million). The segment EBIT margin came in at 15.4%
(2016: 13.6%). Profit before tax increased to € 281
million (2016: € 223 million; +26.0%).

 


Financial Services segment remains on successful course

 

The Financial Services segment continued to
deliver sustainable profitable growth in the third
quarter
. In total, 435,026 new credit financing and
leasing contracts
were signed with retail customers
between July and September (2016: 467,702 contracts; -7.0%). The
portfolio of leasing and credit financing contracts
at 30 September 2017 comprised 4,946,423 contracts (31
December 2016: 4,703,417 contracts; +5.2%). Segment
revenues
grew by 4.3% to € 6,679 million (2016: € 6,403
million). Profit before tax climbed by 7.2% to
€ 609 million (2016: € 568 million).

 

In total, 1,369,263 (2016: 1,341,792) new leasing and
credit financing contracts
were signed during the
first nine months
of 2017, 2.0% more than in the previous
year. Segment revenues grew by 9.7% to € 20,769
million (2016: € 18,940 million). Profit before tax
improved by 9.3% to € 1,793 million (2016: € 1,641 million).



 


Workforce size increased

 

The size of the Group’s workforce increased by
2.8% year-on-year to stand at 129,545 employees at 30 September
(2016: 126,013). The BMW Group continues to recruit skilled workers
and IT specialists in future-oriented areas, such as digitalisation
and automated driving.

 


Outlook for 2017: BMW Group forecasts new record figures

 

The BMW Group is confident of achieving its projected targets
for the current financial year – largely thanks to its strong
brands, its attractive product portfolio and the expectation that
international automobile markets will continue their generally
positive trend. These favourable factors are offset by high levels
of upfront expenditure for key new technologies, intense competition
and rising personnel expenses. The global political and economic
environment is expected to remain volatile.

 

For the financial year 2017, the BMW Group forecasts a slight
increase in deliveries to customers by the
Automotive segment
and a solid (previously: slight)
increase in Group profit before tax, in both cases
to new record figures. “At the same time, we continue to expect
higher expenditure in the fourth quarter for key technological and
strategic projects as well as the roll-out of the largest model
offensive in the history of the BMW Group. Other factors to bear in
mind are the politically volatile environment and high upfront
expenditure for electric mobility and autonomous driving”, explained Krüger.

 

The EBIT margin for the Automotive segment in
2017 is forecast to remain within the target range of between 8 and
10%. With its premium brands, the BMW Group is confident it will
remain the world’s leading provider of premium mobility in 2017. The
BMW Group forecasts a slight (previously: solid) increase in
revenues in the Automotive
segment
. Forecasts for the current year are based on the
assumption that global political and economic conditions will not
change significantly

 

* * *

The BMW Group – an overview

3rd quarter

2017

3rd quarter 2016

Change in %

Sales volume

    

Automotive

Units

590,415

583,499

1.2

Thereof:   BMW

Units

499,467

493,379

1.2

MINI

Units

90,180

89,179

1.1

Rolls-Royce

Units

768

941

-18.4

Sales volume Motorcycles

Units

39,429

35,290

11.7

 

 

 

 

 

Workforce
1

 

129,545

126,013

2.8

 

 

 

 

 

EBIT margin Automotive
Segment

Percent

8.3

8.5

-0.2 %points

EBIT margin Segment Motorcycles

Percent

10.3

7.1

+3.2 %points

EBT margin BMW Group

Percent

10.3

11.0

-0.7 %points

 

 

 

 

 

Revenues


million

23,424

23,362

0.3

Thereof:     Automotive

€ million

21,040

21,564

-2.4

    Motorcycles


million

514

451

14.0

   Financial Services

€ million

6,679

6,403

4.3

   Other Entities


million

1

1

   Eliminations


million

-4,810

-5,057

4.9

 

 

 

 

 

Profit before financial result
(EBIT)

€ million

2,304

2,380

-3.2

Thereof:   Automotive

€ million

1,753

1,837

-4.6

   Motorcycles


million

53

32

65.6

   Financial Services

€ million

607

576

5.4

   Other Entities


million

-12

6

   Eliminations


million

-97

-71

-36.6

 

 

 

 

 

Profit before tax (EBT)

€ million

2,422

2,575

-5.9

Thereof:   Automotive

€ million

1,880

2,030

-7.4

   Motorcycles


million

53

32

65.6

   Financial Services

€ million

609

568

7.2

   Other Entities


million

11

40

-72.5

   Eliminations


million

-131

-95

-37.9

 

 

 

 

 

Income taxes


million

-633

-754

-16.0

Net profit


million

1,789

1,821

-1.8

Earnings per share
2

2.68/2.68

2.75/2.75

-2.5/-2.5

1 Figures exclude dormant employment contracts, employees
in the work and non-work phases of pre-retirement part-time working
arrangements and low wage earners

2 Earnings per share of common stock/preferred stock

 

The BMW Group – an overview

Jan. – Sept. 2017

Jan. – Sept. 2016

Change in %

Sales volume

    

Automotive

Units

1,811,234

1,746,638

3.7

Thereof:   BMW

Units

1,537,497

1,479,936

3.9

MINI

Units

271,394

264,077

2.8

Rolls-Royce

Units

2,343

2,625

-10.7

Sales volume Motorcycles

Units

127,818

116,044

10.1

 

 

 

 

 

Workforce
1

 

129,545

126,013

2.8

 

 

 

 

 

EBIT margin Automotive
Segment

Percent

9.1

9.1

EBIT margin Segment Motorcycles

Percent

15.4

13.6

+1.8 %points

EBT margin BMW Group

Percent

11.7

11.2

+0.5 %points

 

 

 

 

 

Revenues


million

72,671

69,229

5.0

Thereof:     Automotive

€ million

64,708

63,250

2.3

    Motorcycles


million

1,833

1,650

11.1

   Financial Services

€ million

20,769

18,940

9.7

   Other Entities


million

4

4

 

   Eliminations


million

-14,643

-14,615

-0.2

 

 

 

 

 

Profit before financial result
(EBIT)

€ million

7,879

7,562

4.2

Thereof:  Automotive

€ million

5,862

5,778

1.5

   Motorcycles


million

282

224

25.9

   Financial Services

€ million

1,799

1,696

6.1

   Other Entities


million

0

29

   Eliminations


million

-64

-165

61.2

 

 

 

 

 

Profit before tax (EBT)

€ million

8,482

7,741

9.6

Thereof:   Automotive

€ million

6,544

6,041

8.3

   Motorcycles


million

281

223

26.0

   Financial Services

€ million

1,793

1,641

9.3

   Other Entities


million

30

84

-64.3

   Eliminations


million

-166

-248

33.1

 

 

 

 

 

Income taxes


million

-2,330

-2,330

Net profit


million

6,152

5,411

13.7

Earnings per share
2

9.27/9.28

8.19/8.20

13.2/13.2

1 Figures exclude dormant employment contracts, employees
in the work and non-work phases of pre-retirement part-time working
arrangements and low wage earners

2 Earnings per share of common stock/preferred stock

 

For questions please contact:

 

Corporate Communications

 

Max-Morten Borgmann, Business and Finance Communications

Telephone: +49 89 382-24118, Fax: +49 89 382-24418


Max-Morten.Borgmann@bmwgroup.com

 

Glenn Schmidt, Head of Business and Finance Communications

Telephone: +49 89 382-24544, Telefax: +49 89 382-24418


Glenn.Schmidt@bmwgroup.com

 

Internet:
www.press.bmwgroup.com

e-mail:
presse@bmw.de

 

 

 

The BMW Group

 

With its four brands BMW, MINI, Rolls-Royce and BMW Motorrad, the BMW
Group is the world’s leading premium manufacturer of automobiles and
motorcycles and also provides premium financial and mobility services.
As a global company, the BMW Group operates 31 production and assembly
facilities in 14 countries and has a global sales network in more than
140 countries.

 

In 2016, the BMW Group sold approximately 2.367 million cars and
145,000 motorcycles worldwide. The profit before tax was approximately
€ 9.67 billion on revenues amounting to € 94.16 billion. As of 31
December 2016, the BMW Group had a workforce of 124,729 employees.

 

The success of the BMW Group has always been based on long-term
thinking and responsible action. The company has therefore established
ecological and social sustainability throughout the value chain,
comprehensive product responsibility and a clear commitment to
conserving resources as an integral part of its strategy.

 


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