Mercedes-Benz credits discipline, desirability for Q1 profit

German high-end carmaker Mercedes-Benz refused to let the pandemic and the war in Ukraine slam the brakes on its business model, as it reported a first quarter net profit of €3.59 billion on Wednesday, reported dpa, quoting RTT News and AFX.

That represented a 3% increase on the €3.47 billion it earned for the same quarter in 2021.

"Our sharpened focus on desirable top-end and electric vehicles, combined with ongoing cost discipline, allowed us to deliver strong earnings despite numerous headwinds," said Harald Wilhelm, a board member.

"On this foundation we continue to transform our business by growing the luxury business, scaling up production of electric vehicles and accelerating software development."

It said it has shut down multiple operations in Russia due to that country's invasion of Ukraine and is keeping a close eye on operations in Ukraine in case they are disrupted by the fighting.

The company said it also had to deal with lingering effects of the pandemic and supply chain disruptions.

Earnings per share were €3.26, up from €3.18 last year.

Group earnings before interest and tax (EBIT) rose 11% from last year to €5.23 billion.

Earnings were impacted by a €918 million gain from the sale of Canadian own retail operations and the partial sale of MB Grand Prix, which nearly offset €709 million in expenses tied to adjustments of industrial business activities in Russia and €281 million in expenses related to diesel vehicles.

Adjusted EBIT increased 19% from last year to €5.30 billion.

Revenue for the quarter increased 6% to €34.86 billion from last year's €32.88 billion.

Looking ahead for fiscal 2022, the company continues to expect revenue slightly above 2021 and EBIT at the prior-year level.

It said it expects supply constraints related to semiconductors and other industrial upstream products and the Covid-19 pandemic to impact business for the remainder of 2022.