CARMAKER BMW reported an enormous rise in profit yesterday, due to to rocketing sales in emerging markets, though investors were disappointed with the group’s outlook for the rest of the year.
The German company reported third-quarter pre-tax profit of €871m (£760.6m), up from €76m a year ago. This represents an 11-fold increase.
Sales in China have almost doubled since last year, far outstripping a 1.8 per cent rise in Western Europe. UK sales of the group’s BMW, Rolls-Royce and Mini models grew 13 per cent.
Overall revenue rose 36 per cent on last year to €15.9bn, and the group raised its target for auto earnings before interest and tax equivalent to more than seven per cent of revenue this year from the five per cent-plus aimed for in August.
However, shares fell 1.4 per cent to €51.64 as investors had hoped for a more upbeat outlook for next year.
“BMW’s Q3 numbers confirm our view that the luxury auto segment has entered a new phase of profitability and that near double-digit margins were not just a peak in Q2 but a sign of a change in underlying profitability,” Barclays Capital analyst Kristina Church wrote.