P&L CHECK

A Shiny BMW, with Scratches

  • Why it matters

    Why it matters

    BMW needs to its new-model launch to be successful if it wants to keep up with its arch-rival Mercedes and upcoming competitor Tesla. Otherwise the luxury carmaker could start to lose market share.

  • Facts

    Facts

    • In 2016, BMW sold more cars than ever before, over 2 million worldwide. It also achieved record revenues and record profits.
    • However, it was overtaken as best-selling premium carmaker by Daimler, makers of Mercedes.
    • To compete globally and raise revenue for technological change, BMW will increase annual production from 2.4 to 3 million cars in the coming years, Handelsblatt has learned.
  • Audio

    Audio

  • Pdf
main 44166224 source Armin Weigel DPA – BMW employee polishing car logo BMW 2-series Gran Tourer March 2015
Polishing the old models won't be enough for BMW to keep its edge. Source: Armin Weigel / DPA

Record sales, record revenues, record profits – 2016 was another great year for BMW shareholders. Safe to say Chief Executive Harald Krüger can expect a warm reception at Thursday’s annual general meeting.

There’s plenty to celebrate: Strong financial results and lower tax liabilities mean net profit, at €6.9 billion, was the best in company history, up 8 percent on 2015. That has allowed the carmaker to increase dividends on preference shares by €0.30 to €3.52, with BMW paying out a total of €2.3 billion to shareholders, cementing its reputation as a reliable dividend stock. Almost half of that figure went to siblings Susanne Klatten and Stefan Quandt, who own around 47 percent of the firm between them.

And yet, Mr. Krüger knows that 2016 was a strangely muted year for the Munich-based carmaker. BMW may have sold 5.3 percent more cars than the previous year, but arch-rival Mercedes sold even more. Operating profit was very healthy, with earnings before interest and taxes hitting €9.3 billion, around $10.1 billion. But this was 2 percentage points down on 2015. Revenue hit a record too, but was up by a rather meager 2.2 percent.

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