Daimler shares surge on higher-than-expected earnings

Shares in Daimler surged Tuesday after the German carmaker said its second-quarter profit outpaced market expectations compared to the previous year amid strong demand for its luxury Mercedes-Benz cars.

The Stuttgart-based group surprised financial markets with the late-Monday announcement that its adjusted earnings before interest and taxes (EBIT) in the three months to the end of June rose 5.6 per cent to 3.97 billion euros (4.39 billion dollars) from 3.76 billion euros in the same period last year.

The announcement, released after the Frankfurt Stock Market closed on Monday, also confirmed Daimler's 2016 outlook, saying annual earnings would "slightly increase" compared to 2015. The results were not expected to be released until July 21.

Daimler shares opened Tuesday 3.3-per-cent higher in Frankfurt before climbing by more than 4 per cent as morning trading unfolded.

The group's vans business helped to boost the company's second-quarter earnings after it posted a modest gain in profit.

But Mercedes-Benz's adjusted EBIT fell 1.1 per cent to 2.21 billion euros in the second quarter, while earnings at the group's truck business slumped 7.8 per cent to 661 million euros.

Daimler's second-quarter earnings report included a 400-million-euro charge, described by Daimler as costs related to legal proceedings without offering any explanation.

Mercedes-Benz said last week its sales jumped 12.1 per cent to more than 1 million units in the six months to the end of June compared with the same period in 2015 after it successfully revamped its model range, notably its popular E-class vehicle.

Last update: Tue, 12/07/2016 - 12:04

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