Mercedes 2015 Annual Report Download - page 80

Mercedes-Benz Vans posted EBIT of €880 million in 2015,
a significant improvement on its prior-year earnings of €682
million. The division’s return on sales increased to 7.7% from
6.8% in 2014.
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B.15
EBIT reflects the very positive development of unit sales, espe-
cially in Europe and in the NAFTA region. This was mainly due
to the very strong growth rates for the V-Class and the new Vito.
Improved material efficiency also had positive impact on earn-
ings, while expenses for warranties and customer goodwill affected
EBIT negatively. Additionally, expenses of €40 million from a
recall in connection with Takata airbags had a negative effect
on earnings. In the previous year, a gain on the reversal of an
impairment of the investment in the Chinese joint venture Fujian
Benz Automotive Corporation boosted EBIT by €61 million.
Daimler Buses increased its EBIT to €214 million in 2015
(2014: €197 million) and achieved a return on sales of 5.2%
(2014: 4.7%).
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Positive effects resulted in particular from the good business
with complete buses with a positive product mix in Western
Europe as well as further efficiency improvements. The develop-
ment of earnings also benefited from positive exchange-rate
effects. On the other hand, the continuation of the difficult
economic situation in Latin America had a negative impact on
earnings. The division’s EBIT includes a gain of €16 million on
the sale of the shares in MCI Holdings Inc.
In 2015, Daimler Financial Services posted EBIT of €1,619
million, significantly surpassing its prior-year earnings (2014:
€1,387 million). The division’s return on equity was 18.3%
(2014: 19.4%).
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The main reasons for this development were the increased
contract volume and positive exchange-rate effects, which
more than offset additional expenses in connection with the
expansion of business operations.
The reconciliation of the divisions’ EBIT to Group EBIT com-
prises gains and/or losses at the corporate level and the
effects on earnings of eliminating intra-group transactions
between the divisions.
Items at the corporate level resulted in an expense of €79 million
(2014: income of €713 million). The income in the previous
year primarily resulted from our investments in RRPSH and Tesla.
In 2014, Daimler had a gain of €1,006 million from the sale of
the shares in RRPSH and an expense of €118 million from the
remeasurement of the put option on those shares. In connec-
tion with our investment in Tesla, the loss of significant influence
on that company meant that the Tesla shares had to be remea-
sured, resulting in a gain of €718 million. The hedge of Tesla’s
share price and the sale of those shares resulted in total
expenses of €124 million in 2014. Items at the corporate level
also included expenses of €600 million related to the ongoing
antitrust investigations of European manufacturers of commercial
vehicles by the EU Commission.
The elimination of intra-group transactions resulted in income
of €50 million in 2015 (2014: €42 million).
The reconciliation of Group EBIT to profit before income taxes
is shown in table
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B.17.
B.17
Reconciliation of Group EBIT to profit before income taxes
2015 2014
In millions of euros
Group EBIT 13,186 10,752
Amortization of capitalized borrowing costs1-10 -9
Interest income 170 145
Interest expense -602 -715
Profit before income taxes 12,744 10,173
1 Amortization of capitalized borrowing costs is not included in the internal
performance measure EBIT, but is a component of cost of sales.
B | COMBINED MANAGEMENT REPORT | PROFITABILITY 87
Return
on Equity
Daimle
r Financial Services
In
%
25
30
20
15
10
5
0
B.16
2011 2012 2014 20152013
Return on Sales
In %
9
12
6
3
0
-3
-6
2013 20
15
2014
2011
2012
Mercedes-Benz
Cars
Daimler
Trucks
Mercedes-Benz
Vans
Daimler
Buses
B.15
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