Daimler previews a difficult first quarter

Daimler Headquarters building

Daimler AG (OTC: DDAIF) previewed preliminary first-quarter results on Thursday, revealing across-the-board difficulties for the German manufacturer.

The Stuttgart-based parent of Daimler Trucks and Mercedes-Benz automobiles said first-quarter earnings before interest and taxes (EBIT) would be about 617 million euro ($665 million) compared with 2.8 billion euro ($3 billion) in the first quarter of 2019.

Daimler Trucks & Buses, which recently combined into a business unit, expects to report an EBIT of 247 million euro, less than half the 553 million euro reported in the year-ago quarter.

The company said its original financial forecast for 2020 is still invalid because of the unknown business impact of the COVID-19 pandemic.

“However, we do now expect the Group’s total unit sales for 2020 to be below the prior year, with lower unit sales at each of Mercedes-Benz Cars, Mercedes-Benz Vans, Daimler Trucks and Daimler Buses,” Daimler said in a statement. “As a result we expect the group revenue for the financial year 2020 to be below the prior year.”

EBIT and industrial cash flow for the year are expected to fall below 2019.

“Having implemented a comprehensive set of cash protection measures and having increased our financial flexibility, we are confident that we are well positioned to manage the business, both during and after the COVID-19 pandemic,” the company said.

Daimler will report actual first-quarter results on Wednesday.