Mercedes 2003 Annual Report Download - page 96
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Please find page 96 of the 2003 Mercedes annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.Even if the aforementioned income and expense items are not
taken into account, operating profit decreased compared with the
prior year, primarily due to the performance of the Chrysler Group.
Additional impacts on the Group’s operating profit were the
negative contribution to earnings by Mitsubishi Motors Corporation
and lower earnings from EADS, both of which are accounted for
using the equity method. On the other hand, the Mercedes Car
Group, Commercial Vehicles and Services segments succeeded in
raising their operative income compared with the prior year.
Again increase in operating profit of Mercedes Car Group.
Mercedes Car Group realized an operating profit of €3.1 billion in
2003, thus once again surpassing its result of the prior year (€3.0
billion).
In 2003 the segment sold 1,216,900 vehicles in a difficult market
environment (2002: 1,232,300). Despite lower unit sales, revenues
increased by €1.3 billion to €51.4 billion as a result of an improved
model mix.
With 1,092,200 vehicles sold worldwide, sales of Mercedes-Benz
passenger cars nearly matched the high level of the prior year
(1,110,000 vehicles). Negative effects on the segment’s profit
contribution caused by the slight decrease in unit sales and
advance expenditures for the products of the second model
offensive were more than offset by positive effects from the
improved model mix, with the full availability of the E-Class sedan
and the CLK coupe, and from higher unit sales of the S-Class and
SL-Class. Advance expenditures for new products were higher than
in the prior year, and were related in particular to successor
models and the additional versions of the A-Class and M-Class, as
well as the upcoming launch of the CLS coupe.
Analysis of the Financial Situation
Financial Reporting | Overview | Analysis of the Financial Situation | Statement by the Board of Management | Independent Auditors’ Report | Financial Statements
1. Operating Results
Lower operating profit due to difficult market conditions in
North America. DaimlerChrysler generated an operating profit of
€5.7 billion in the year 2003, compared with €6.9 billion in 2002.
The results of both years were significantly affected by charges for
restructuring activities, impairments recognized on fixed assets,
and gains realized on the sale of investments. Chrysler Group’s
earnings were impacted by additional restructuring charges of €0.5
billion, while the corresponding impact in the prior year was €0.7
billion. The operating profit of the prior year was also affected by
restructuring charges of €0.3 billion at the Commercial Vehicles
segment and by impairments on fixed assets of €0.5 billion at the
Commercial Vehicles and Services segments. In 2002, the
Services segment also incurred additional costs of €0.1 billion as
a result of the decision of the Argentine government to reform its
financial system and monetary policy.
The sale of the business unit MTU Aero Engines had a positive
effect of €1.0 billion on the operating profit of Other Activities in
2003. In the prior year, gains totaling €2.6 billion from the sale of
our investments in T-Systems and Conti Temic microelectronic
were included in the results of the Services and Other Activities
segments.
Group operating profit of €5.7 billion compared with €6.9 billion in 2002 |Mercedes Car Group
surpasses high prior-year earnings |Earnings of Chrysler Group affected by difficult market conditions
and ongoing restructuring activities |Operative income significantly improved at Commercial
Vehicles and Services |Sale of the business unit MTU Aero Engines led to a gain of €1.0 billion in
operating profit |Underfunded status of pension obligations reduced |Cash provided from operating
activities in the industrial business increased despite negative effects
Note:
The chapters “Business Review,” “Analysis of the Financial Situation” and “Outlook”
together comprise the DaimlerChrysler Group’s Management Report, which is based on the
consolidated financial statements prepared in accordance with United States Generally
Accepted Accounting Principles (US GAAP).
In millions
Operating Profit (Loss) by Segments
2003 2003 2002
3,938
(637)
1,077
1,562
1,619
(396)
7,16 3
3,126
(506)
855
1,240
1,285
(314)
5,686
3,020
609
(343)
3,060
903
(395)
6,854
Mercedes Car Group
Chrysler Group
Commercial Vehicles
Services
Other Activities
Eliminations
DaimlerChrysler Group
US $€€