Luxury automaker BMW AG saw its
third-quarter net profit leap 78 per cent, driven by increased
sales, and raised its sales outlook for the rest of 2007 on Tuesday.
The Munich-based automaker earned 803 million euros (US$1.2
billion) in the July-September period compared with 452 million
euros a year earlier.
Sales at BMW, which also makes the Mini, the Rolls-Royce and
high-end motorcycles, climbed 19 per cent to 13.78 billion euros
Despite some market worries about the company's exposure to the
falling U.S. dollar, BMW said it was ``well on its way toward
achieving its earnings and sales volume targets for the full year.''
``The BMW Group will focus its attention on profitability and
increasing value over the long term,'' said chief executive Norbert
Pretax profit rose 6.3 per cent to 765 million euros ($1.1
billion), up from 720 million euros a year earlier.
``BMW's numbers mark a slightly better performance after a very
disappointing year so far, with at least some of the top-line
strength feeding through into earnings growth,'' said auto analyst
Stephen Cheetham at Sanford C. Bernstein Ltd.
``However, apart from higher net income due to lower taxes, the
numbers came in below our estimates, and do little to dispel
investor fears of the company's continued exposure to a weaker U.S.
The euro currency hit another new high Tuesday, but BMW said it
did not expect the negative impact to be bigger than the 666 million
euros it posted in 2006.
``All of the main currencies are fully hedged for the business
year 2007,'' the company said, adding it had been ``confronted with
higher purchase prices for steel, precious metals and other
Cheetham said markets would likely take a ``wait and see
approach'' to the company, and BMW shares fell 4.5 per cent in
In terms of sales, the company said it saw strong demand in all
markets, including the United States, and it expects to sell more
than 1.4 million cars this year. Reithofer said BMW hopes to sell
more than 1.8 million vehicles a year by 2012.
Third-quarter sales rose 13 per cent to 364,564 vehicles.
The company recently introduced its new 6-Series coupe and
convertible and its new Mini Clubman is expected to go on sale
worldwide later this month.