By Kim Richters
BMW AG on Wednesday said effects from the war in Ukraine are restricting its production and have an impact on the current-year outlook, though earnings are expected to rise significantly thanks to the consolidation of its Chinese joint venture.
The German luxury-car maker said it expects car deliveries this year to be on the same level as 2021 because the situation in Eastern Europe is affecting production.
"Without these negative effects, year-on-year deliveries in the Automotive Segment would have been expected to trend slightly higher," BMW said.
The company is also guiding for an earnings before interest and taxes margin for its automotive segment between 7% and 9% in 2022, which compares with 10.3% in 2021.
"Without the impact of the war in Ukraine, the BMW Group would have targeted a range of 8%-10%," it said.
The auto maker also expects free cash flow in its automotive segment to reach at least EUR7 billion this year and group earnings before taxes to grow significantly thanks to the previously announced consolidation of joint venture BMW Brilliance Automotive.
As already announced, BMW said it will see positive one-time effects from the consolidation on earnings and revenue in the automotive segment, which are to increase significantly. The consolidation doesn't affect the segment's Ebit margin.
BMW released figures for 2021 earlier this month, with after-tax profit jumping to EUR12.46 billion from EUR3.86 billion in 2020, and revenue rising to EUR111.24 billion from EUR98.99 billion.
Write to Kim Richters at firstname.lastname@example.org
(END) Dow Jones Newswires
March 16, 2022 03:35 ET (07:35 GMT)Copyright (c) 2022 Dow Jones & Company, Inc.