Mercedes-Benz delivers strong full year results in 2022
Neue Beschilderung in der Zentrale der Mercedes-Benz Group AG in Stuttgart-Untertürkheim New Signage at the Headquarters of Mercedes-Benz Group AG in Stuttgart-Untertürkheim, Germany
- Profitable growth: Group EBIT substantially improved by 28% to €20.5 billion (2021: €16.0 billion) as revenue increased by 12% to €150.0 billion (2021: €133.9 billion)
- Resilient operations: Mercedes-Benz Cars adjusted Return on Sales (RoS) reaches 14.6% (2021: 13.1%), 11.2% for Mercedes-Benz Vans (2021: 8.3%), and an adjusted Return on Equity (RoE) of 16.8% for Mercedes-Benz Mobility (2021: 22.0%) despite macro challenges
- Transformation continues: Announced global charging network, realigned production network to scale EVs, Level 3 conditionally automated driving approved in Nevada, new partnerships for sourcing raw materials and semiconductors established
- Dividend increased: Proposal of €5.20 (2021: €5.00)
- Share buyback: Shares worth up to €4 billion to be repurchased over 2 years
- Outlook 2023: Group revenue expected at prior-year level, EBIT seen slightly below 2022 level, Free Cash Flow (Industrial Business) at prior-year level, Mercedes-Benz Cars adjusted RoS seen in the range of 12%-14%, Mercedes-Benz Vans adjusted RoS seen at 9%-11% and Mercedes-Benz Mobility adjusted RoE at 12%-14%
Mercedes-Benz Group AG’s (ticker symbol: MBG) sharpened focus on high-end passenger cars and premium vans, combined with tight cost control, helped to lift Earnings Before Interest and Taxes (EBIT) by 28% to €20.5 billion (2021: €16.0 billion) last year, outpacing a 12% rise in revenue to €150.0 billion (2021: €133.9 billion) during the same period. In its first year after the Daimler Truck spin-off, Mercedes-Benz Group continued its transformation amid geopolitical and macroeconomic challenges. Strong results underline the improved profitability, even as the COVID-19 pandemic and semiconductor supply-chain bottlenecks and the fallout from Russia’s war against Ukraine continued to affect the business.
”We have redesigned Mercedes-Benz to be a more profitable company thanks to our focus on desirable products and disciplined margin and cost management. We cannot control macro or world events, but 2022 is a case in point that we are moving in the right direction”, said Ola Kaellenius, Chief Executive Officer of Mercedes-Benz Group AG.
“In addition to delivering strong financial results, the team accelerated our pace as a technology leader in electric and automated driving. The next chapter in our transformation will be revealed during the Mercedes-Benz Strategy Update in California on February 22 focusing on the Mercedes-Benz Operating System (MB.OS).“
Mercedes-Benz expanded its offering of battery electric vehicles to 9 cars and 4 vans, including the new EQS SUV and EQE SUV and most recently unveiled a new eSprinter. To scale manufacturing of zero-emission vehicles, the Mercedes-Benz cars and vans production network was retooled, and new deals with suppliers were struck. Mercedes-Benz will source battery cells from a new factory built by Contemporary Amperex Technology Co., Ltd (CATL) in Debrecen, Hungary. An annual supply agreement for an average 10,000 tonnes of lithium hydroxide from Canadian-German start-up Rock Tech Lithium Inc. was signed. In addition, Mercedes-Benz announced plans to launch a global high-power charging network across North America, Europe, China and other key markets.
Investments, free cash flow and liquidity
The free cash flow of the industrial business rose to €8.1 billion (2021: €7.9 billion). The net liquidity of the industrial business rose to €26.6 billion (end of 2021: €21.0 billion). The Group’s investments in property, plant and equipment in the full year totaled €3.5 billion (2021: €4.6 billion*). Research & development expenditure amounted to €8.5 billion (2021: €9.1 billion*).
*In 2021, Daimler’s commercial vehicle business is included until the time of the spin-off and hive-down
In a challenging macroeconomic environment, Mercedes-Benz Cars sold 2,040,719 vehicles (+5%). In line with the strategy to focus on EVs, Mercedes-Benz had strong BEV sales of 149,227 units incl. smart (+67%). Sales in the Top-End segment increased by 8% driven by the S-Class (+6%) and additionally its all-electric version EQS, with more than 23,400 vehicles sold. Q4 marked the best sales quarter for this all-electric flagship. Furthermore, Mercedes-Maybach achieved a new record year with sales up 41%. Strong sales of C-Class, the top-seller GLC and the new EQE led to a rise in sales in the Core segment of 9%. The adjusted Return on Sales (RoS) for Mercedes-Benz Cars rose to 14.6% from 13.1% in the year-earlier period.
In the fourth quarter, deliberate decisions to make payments to selected suppliers and the impact of the so-called “inflation bonus” for eligible staff in Germany resulted in slight headwinds and an adjusted Return on Sales of a still high 13.4%.