Financial year 2008: Group EBIT of €2.7 billion (2007: €8.7 billion)

• Net profit of €1.4 billion (2007: €4.0 billion)

• Revenue of €95.9 billion (2007: €99.4 billion)

• Dividend to amount to €0.60 per share (2007 €2.00)

• Outlook: substantial burdens on EBIT anticipated for 2009

• Intensified efficiency programs

Daimler AG (stock abbreviation DAI) today presented its preliminary and unaudited figures for the Group and the divisions for the 2008 financial year.

Daimler achieved EBIT of €2,730 million in 2008 (2007: €8,710 million).

The decrease in Group EBIT was mainly the result of expenses totaling €3,228 million (2007: charges of €377 million) related to the investment in Chrysler and the lower earnings achieved by Mercedes-Benz Cars. Another factor is that prior-year EBIT included higher gains realized on the transfer of portions of Daimler's equity interest in EADS (2008: €130 million; 2007: €1,573 million). Daimler Trucks did not achieve its prior-year earnings, primarily due to the difficult economic situation in the United States and expenses incurred for the repositioning of its activities in the NAFTA region. The development of earnings was positive at Daimler Financial Services and the Mercedes-Benz Vans and Daimler Buses units.

Based on the divisions' projections, the Group had forecast EBIT from continuing operations of more than €6 billion. This did not include special items from the revaluation of leased vehicles' residual values at Mercedes-Benz Cars, the sale of real estate at Potsdamer Platz, the transfer of interest in EADS, the repositioning of Daimler Trucks North America, the new management model and effects related to Chrysler. Excluding those special items, Daimler achieved that goal.

Earnings in both years were affected by special items, as shown in the tables on pages 12 and 13.

For Daimler, the year 2008 consisted of a very good first half and a difficult second half. Dr. Dieter Zetsche, Chairman of the Board of Management of Daimler AG and Head of Mercedes-Benz Cars, stated at Daimler's Annual Press Conference: "During the first half of 2008, we proved how well we perform under normal economic conditions. Many of our business operations were headed for very good results."

Net profit for the full year amounted to €1.4 billion (2007: €4.0 billion) and earnings per share amounted to €1.41 (2007: €3.83).

The Board of Management proposes to the Supervisory Board that a dividend of €0.60 per share be distributed for the year 2008 (2007: €2.00 per share). Related to the number of shares entitled to a dividend at December 31, 2008, this constitutes a dividend distribution of €556 million (2007: €1,928 million). The main reasons for the dividend adjustment are the level of earnings achieved in 2008 and the difficulty in estimating the further development of the world economy and the automotive markets.

Unit sales and revenue

Despite extremely difficult market conditions, especially in the second half of the year, Daimler sold a total of 2.1 million vehicles in 2008, thus nearly equaling the prior-year level. Daimler's total revenue amounted to €95.9 billion in 2008, compared with €99.4 billion in the prior year; adjusted for exchange-rate effects, there was a decrease of 1%.

Free cash flow and liquidity

Due to the crisis-like development in the second half of the year, the free cash flow of the industrial business for the full year of minus €3.9 billion was not satisfactory (2007: plus €7.6 billion). This was primarily caused by the unexpected sharp decrease in unit sales at Mercedes-Benz Cars in the fourth quarter. Despite cuts in production, inventory levels remained high. In addition, there were disproportionately high payments to suppliers because many invoices regularly have to be paid at the end of the year and trade payables from the third quarter had to be settled. The reduction in the free cash flow was also caused by the temporarily increased investment in the new E-Class and in technologies for the reduction of CO2 emissions, as well as by the acquisition of a 10% equity interest in Kamaz, a Russian truck manufacturer.

The Daimler Group has a good level of liquidity. It decreased by €9.1 billion to €8.0 billion in 2008. The unusually high liquidity at December 31, 2007 was related to the sale of a majority interest in Chrysler. As a result of the decrease, a level of liquidity appropriate to the Daimler Group has been achieved.

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