Daimler CEO Zetsche bounces back from rough start to year with strong fourth quarter

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FRANKFURT – Automaker Daimler AG finished 2013 strongly after a rough start to the year that included a profit warning.

Fourth-quarter operating earnings jumped 45 per cent to 2.53 billion euros ($3.41 billion) from 1.74 billion euros, excluding a one-time gain from the sale of a stake in aerospace company EADS, the company said Thursday.

Revenues increased 8 per cent to 32.09 billion euros, boosted by a stronger lineup of small vehicles from the core Mercedes-Benz luxury brand, such as the A-Class, B-Class and CLA. The company also introduced a new version of its S-Class luxury sedan, its brand’s flagship model, equipped with technology such as hot-stone seat massage for the driver and nearly autonomous driving capability.

The year included an April profit warning, and CEO Dieter Zetsche saw his contract renewed for only three years — a signal he needed to turn things around.

“2013 was a year that we didn’t begin particularly well, but which we ended successfully,” Zetsche said in a statement. “Our efforts paid off.”

Counting the one-time gain from a year ago, net profit fell 36 per cent to 1.68 billion euros ($2.27 billion). The comparison was distorted by a large gain booked the prior year, when the company reaped 709 million euros from the EADS sale.

For the full year, net profit came in at a record 8.7 billion euros, up 28 per cent. The figure was boosted by 3.2 billion euros from the sale of the EADS holding which the company no longer regarded as central to its business. Full year revenues rose 3 per cent to 117.99 billion euros.

The Stuttgart-based company said it would propose an increase in its dividend to 2.25 euros a share from 2.20 euros. Some 130,000 eligible workers will get profit-sharing and one-time bonuses totalling 3,041 euros with their April paychecks.

Daimler shares traded up 3 per cent at 62.74 euros in morning trading in Europe.

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