BERLIN (dpa-AFX) - Mercedes-Benz Group AG (MBGAF) said it has lowered its guidance for 2024 due to a further deterioration of the macroeconomic environment, primarily in China.
The German auto-major now expects annual EBIT to be significantly below the prior year's level, whereas it had previously anticipated a slight decline compared to the prior year.
According to the company, China's GDP growth has lost further momentum due to weaker consumption and an ongoing downturn in the real estate sector. This decline has impacted overall sales volume in China, including the Top-End segment. As a result, the sales mix for the second half of 2024 is anticipated to remain consistent with the first half, but weaker than originally projected.
Additionally, the second half of 2024 is expected to face various valuation adjustments, and the dynamic pricing environment is likely to persist.
Consequently, Mercedes-Benz Group has revised its full-year outlook.
Mercedes-Benz Cars now expects annual adjusted Return on Sales to be between 7.5% and 8.5% compared to the prior outlook of 10% to 11%.
Mercedes-Benz Vans' expected adjusted Return on Sales remains unchanged at 14% to 15%, while Mercedes-Benz Mobility's expected adjusted Return on Equity remains at 8.5% to 9.5%.
The free cash flow of the industrial business for the Mercedes-Benz Group is now expected to be significantly below the prior year's level, compared to the previous expectation of a slight decline.
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