Munich. The BMW Group once again demonstrated its
ability to generate sustained profitability in 2017, posting its
eighth successive record year. Despite a significant increase in
upfront expenditure for future mobility the company reported its best
ever figures to date for sales volume, revenues and earnings. In
addition, the BMW Group delivered more than 100,000 electrified
vehicles to customers for the first time in a single year, firmly
underpinning the Group’s role as a pioneer and key driver of electric
mobility. In line with its Strategy NUMBER ONE
NEXT, the BMW Group continues to play a leading role in
transforming the mobility sector with its future-oriented ACES
programme: Automated, Connected,
Electrified and Services.
“We can look back on the most successful year in our corporate
history and have achieved record levels for revenues and earnings for
the eighth year in succession,” stated Harald Krüger,
Chairman of the Board of Management of BMW AG in Munich on Thursday.
“Since 2016, we have taken numerous strategic decisions to further
grow our business on a sustainable basis in the years ahead.”
New sales volume, revenues and earnings records in 2017
Automotive sales volume increased by 4.1% to a new
record level of 2,463,526 units in 2017 (2016: 2,367,603 units). With
its three premium automotive brands, BMW, MINI and Rolls-Royce, the
BMW Group asserted its position as the world’s leading manufacturer of
premium vehicles. Deliveries of electrified vehicles
jumped by 65.6% to 103,080 units, driven by the all-electric BMW i3
sales which have risen every year since the model’s market launch in
2013. The BMW Group intends to increase the sales volume of
electrified vehicles to at least 140,000 units in 2018 and bring more
than half a million electrified vehicles onto the roads by the end of 2019.
Group revenues rose to a new record level of € 98,678
million in 2017 (2016: € 94,163 million; +4.8%), with currency effects
slightly restraining growth. Profit before financial
result (EBIT) rose by 5.3% to € 9,880 million (2016: € 9,386
million). Group profit before tax (EBT) went up
significantly year-on-year, partly helped by favourable valuation
effects, and – thanks to a 10.2% rise to € 10,655 million (2016:
€ 9,665 million) – finished the year for the first time above the
ten-billion-euro mark. As in the previous year, all three operating
segments – Automotive, Motorcycles and Financial Services – reported
record pre-tax earnings, each making a contribution to earnings growth
in 2017. The pre-tax return on sales (EBT margin) for
the Group improved to 10.8% (2016: 10.3%), ensuring that the BMW Group
remains one of the automobile industry’s leaders when it comes to profitability.
Income tax expense amounted to € 1,949 million in the
year under report (2016: € 2,755 million). The significantly lower tax
expense in 2017 was mainly due to the reduction in the US federal
corporate income tax rate from 35% to 21% with effect from 1 January
2018, which was taken into account in the measurement of deferred
taxes at 31 December 2017. The revaluation gave rise to a positive
impact of € 977 million on deferred taxes recognised through the
income statement. Group net profit benefitted
accordingly and rose to € 8,706 million (2016: € 6,910 million; +26.0%).
Nicolas Peter, Member of the Board of Management of
BMW AG responsible for Finance, stated: “Last year we allocated around
one billion euros more on research and development than in 2016 – and
nevertheless increased our operating profit. This is what we mean by
sustained profitability.” In 2017, the BMW Group raised research and
development expenditure by 18.3% to € 6,108 million (2016: € 5,164
million). Expressed as a percentage of revenues, the research and
development expenditure ratio at Group level rose to 6.2% (2016: 5.5%).
“In 2018, we expect the ratio to reach its highest level to date,
with expenditure again rising by a further high three-digit million
euro amount year-on-year. We need to earn these additional outlays by
working with the utmost efficiency on the performance side while also
maintaining a keen focus on the expenses side,” commented Peter.
Dividend of € 4.00 per share of common stock proposed
“A company is only as good as its workforce. With their exemplary
dedication, our employees are the driving force behind our success
story,” stated Harald Krüger. “That is why, we pay
our permanent staff in Germany the highest profit share in the
sector.” At the Annual General Meeting on 17 May 2018, the Board of
Management and the Supervisory Board will propose to shareholders that
the dividend be increased to a new high of € 4.00
(2016: € 3.50) per share of common stock and € 4.02 (2016: € 3.52) per
share of preferred stock. The distribution rate of
30.2% (2016: 33.3%) will be within the BMW Group’s target range of
between 30 and 40%. “The proposal to raise the dividend by a
significant amount is a clear sign of the BMW Group’s confidence that
it is ideally placed to perform well in the future on a sustainable
basis,” said Krüger.
Consistently high profitability in Automotive segment
Automotive segment revenues grew by 2.5% to € 88,581
million (2016: € 86,424 million) on the back of positive sales volume
figures. EBIT improved slightly by 2.2% to € 7,863
million (2016: € 7,695 million). The EBIT margin came
in at 8.9%, unchanged from the previous year, thus finishing within
the target range of between 8 and 10% or higher for the eighth
financial year in a row since 2010. Segment profit before
tax increased by 9.8% to set a new record of € 8,691 million
(2016: € 7,916 million).
In 2017, the Group again delivered over two million
BMW brand vehicles to customers. Sales volume rose by 4.2% to
2,088,283 units year-on-year (2016: 2,003,359 units). The BMW
X family remained a significant growth driver, with 9.6%
more vehicles delivered to customers – an excellent performance
considering the BMW X3 model change has been in
progress since the second half of the year. Following the completion
of the BMW 5 Series Sedan model change, December
sales of the world’s leading premium business sedan were more than 55%
up on the previous year, while sales volume for the year as a whole
grew by 6.3% to 291,856 units. Other models contributing to growth in
2017 included the BMW 1 Series (201,968 units;
+14.7%) and the brand’s flagship BMW 7 Series (64,311
units; +4.5%).
The MINI brand set a new sales volume record in 2017
with 371,881 deliveries worldwide and 3.2% year-on-year growth. Sales
of the new MINI Countryman jumped by 30.0% (84,441
units). The MINI Convertible also made an important
contribution to the brand’s successful performance, recording sales
volume growth of 12.0% (33,317 units).
Rolls-Royce Motor Cars delivered 3,362 units (-16.2%)
to customers in almost 50 countries around the globe. The figure was
achieved despite volatility in key Middle East markets and the Phantom
being unavailable throughout the year due to model change. The new
Phantom was unveiled to the acclaim of an international public in
London in July and has already received a large number of pre-orders.
First customer deliveries commenced at the beginning of this year.
The BMW Group remains committed to its strategy of achieving a
balanced distribution of sales worldwide.
The BMW Group again recorded high growth in Asia,
where a total of 848,826 BMW, MINI and Rolls-Royce brand vehicles were
sold, representing double-digit growth of 13.6% (2016: 747,291 units).
The Chinese market made a key contribution to this performance with
595,020 units delivered to customers (2016: 516,785 units; +15.1%).
In Europe, the BMW Group sold a total of 1,101,760
units across its three brands, thus remaining at the previous year’s
high level (2016: 1,092,155 units; +0.9%). The sales volume figure of
241,674 units for Great Britain was down on the previous year (2016:
252,205 units; -4.2%). Deliveries to customers in France increased to
89,957 units (2016: 84,305 / +6.7%). The sales volume also increased
in Italy with 86,663 deliveries (2016: 83,765 / +3.5%).
The Americas region saw a slight decrease in the
number of deliveries over the year as a whole (451,136 units; -2.0%),
with the limited availability of BMW X models having an impact on
volumes. In a highly competitive market environment, deliveries in the
USA dipped slightly to 353,819 units (2016: 366,493 units; -3.5%). In
the fourth quarter of 2017, however, a turnaround was perceptible in
both the USA (98,137 units; 2016: 96,609 units; +1.6%) and in the
Americas as a whole (124,547 units; 2016:122,393 units; +1.8%).
Motorcycles segment deliveries surpass 150,000 units for the
first time
2017 was also a record-breaking year for the Motorcycles
segment. Motorcycle and maxi-scooter deliveries rose by 13.2%
to 164,153 units (2016: 145,032 units), making it the seventh
consecutive record-breaking year and the first in which more than
150,000 units were sold. Segment revenues also rose
significantly to € 2,283 million (2016: € 2,069 million; +10.3%).
Similarly, EBIT improved to € 207 million (2016:
€ 187 million; +10.7%). As in the Automotive segment, the BMW Group is
also targeting an EBIT margin within a range of 8 to
10% in the Motorcycles segment. In the financial year 2017, the margin
came in at 9.1% (2016: 9.0%). Profit before tax
increased by 10.8% to € 205 million (2016: € 185 million).
Financial Services segment continues to break records
The Financial Services segment also continued to perform well in
2017. The number of new contracts concluded with
retail customers rose slightly to 1,828,604 contracts (2016: 1,811,157
contracts; +1.0%) during the twelve-month period. At 31 December 2017,
the contract portfolio comprised 5,380,785 contracts,
thus growing by 5.2% year-on-year (2016: 5,114,906 contracts).
Segment revenues were 7.3% higher at € 27,567
million (2016: € 25,681 million). Profit before tax
increased slightly to € 2,207 million (2016: € 2,166 million; +1.9%).
Increase in workforce and number of apprentices
The size of the workforce grew by 4.2% in 2017. At
31 December, the BMW Group employed 129,932 people worldwide (2016:
124,729 employees). Projects relating to vehicle electrification and
autonomous driving played a major role in the additional recruitment.
Growth in automotive and motorcycle business on the one hand and the
expansion of financial and mobility services on the other also
contributed to the rise. The BMW Group continues to place great
emphasis on its trainee programme and has again invested some € 350
million in basic and further training. Overall, more than 4,750 young
people worldwide were employed in vocational training
and training programmes for young talent at 31 December 2017.
BMW Group targets further volume growth in 2018
With its highly attractive model range, the BMW Group expects
worldwide deliveries of its vehicles to rise in 2018.
The increasing availability of the new BMW X3 and the launch of
appealing new products such as the BMW Z4 or the BMW 8 Series are
likely to provide additional momentum. “This year we are targeting
another new sales record, with deliveries slightly up on the previous
year”, Krüger stated. At the same time, the BMW Group
expects the political and economic environment to remain volatile.
Supervisory Board
At the Annual General Meeting to be held on 17 May 2018, the
Supervisory Board will propose that Prof. Dr. Reinhard Hüttl, Chairman
of the Executive Board of Helmholtz-Centre Potsdam – GFZ German
Research Centre for Geosciences, Dr. Karl-Ludwig Kley, Chairman of the
Supervisory Board of E.ON SE and Deutsche Lufthansa AG and Prof. Dr.
Renate Köcher, Director of Institut für Demoskopie Allensbach
Gesellschaft zum Studium der öffentlichen Meinung mbH, be re-elected
to the BMW AG Supervisory Board.
Furthermore, the Supervisory Board will propose to the shareholders
that Dr. Kurt Bock, Chairman of the Board of Executive Directors of
BASF SE, be elected to the Supervisory Board of BMW AG. In agreement
with the Supervisory Board, Dr. h.c. Robert Lane will resign effective
the end of the Annual General Meeting. The Supervisory Board would
like to thank Dr. h.c. Lane for several years of invaluable and
trusted cooperation.
* * *
Further information on the Group Financial Statements 2017 and the
outlook for the current year will be available at the BMW Group’s
Annual Accounts Press Conference to be held in Munich on 21 March
2018.
The BMW Group – an Overview
2017
2016
Change in %
Deliveries to customers
Automotive
units
2,463,526
2,367,603
4.1
thereof: BMW
units
2,088,283
2,003,359
4.2
MINI
units
371,881
360,233
3.2
Rolls-Royce
units
3,362
4,011
-16.2
Motorcycles
units
164,153
145,032
13.2
Workforce
1
129,932
124,729
4.2
Automotive
segment EBIT margin
%
8.9
8.9
–
Motorcycles
segment EBIT margin
%
9.1
9.0
+0.1 % points
EBT margin BMW Group
%
10.8
10.3
+0.5 % points
Revenues
€ million
98,678
94,163
4.8
thereof: Automotive
€ million
88,581
86,424
2.5
Motorcycles
€ million
2,283
2,069
10.3
Financial Services
€ million
27,567
25,681
7.3
Other Entities
€ million
7
6
16.7
Eliminations
€ million
-19,760
-20,017
1.3
Profit before financial result
(EBIT)
€ million
9,880
9,386
5.3
thereof: Automotive
€ million
7,863
7,695
2.2
Motorcycles
€ million
207
187
10.7
Financial Services
€ million
2,194
2,184
0.5
Other Entities
€ million
14
-17
–
Eliminations
€ million
-398
-663
40.0
Profit before tax (EBT)
€ million
10,655
9,665
10.2
thereof: Automotive
€ million
8,691
7,916
9.8
Motorcycles
€ million
205
185
10.8
Financial Services
€ million
2,207
2,166
1.9
Other Entities
€ million
80
170
-52.9
Eliminations
€ million
-528
-772
31.6
Income taxes
€ million
-1,949
-2,755
29.3
Net profit
€ million
8,706
6,910
26.0
Earnings per share
2
€
13.12/13.14
10.45/10.47
25.6/25.5
1 Excluding dormant employment contracts, employees in the
work and non-work phases of pre-retirement part-time working
arrangements and low wage earners
2 Earnings per share of common stock/preferred stock
For questions please contact:
Corporate Communications
Max-Morten Borgmann, Business and Finance Communications
Telephone: +49 89 382-24118, fax: +49 89 382-24418
Max-Morten.Borgmann@bmwgroup.com
Glenn Schmidt, Head of Business and Finance Communications
Telephone: +49 89 382-24544, fax: +49 89 382-24418
glenn.schmidt@bmwgroup.com
Internet: www.press.bmwgroup.com
E-mail: presse@bmw.de
The BMW Group
With its four brands BMW, MINI, Rolls-Royce and BMW Motorrad, the BMW
Group is the world’s leading premium manufacturer of automobiles and
motorcycles and also provides premium financial and mobility services.
The BMW Group production network comprises 30 production and assembly
facilities in 14 countries; the company has a global sales network in
more than 140 countries.
In 2017, the BMW Group sold over 2,463,500 passenger vehicles and
more than 164,000 motorcycles worldwide. The profit before tax in the
financial year 2017 was € 10.655 billion on revenues amounting to €
98.678 billion. As of 31 December 2017, the BMW Group had a workforce
of 129,932 employees.
The success of the BMW Group has always been based on long-term
thinking and responsible action. The company has therefore established
ecological and social sustainability throughout the value chain,
comprehensive product responsibility and a clear commitment to
conserving resources as an integral part of its strategy.
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