Daimler Truck: Record results in 2023

Itumeleng Garebatshabe
By Itumeleng Garebatshabe 174 Views 11 Min Read
11 Min Read
  • Continued growth and further improved profitability: Daimler Truck achieved financial targets for 2023, on track to reach 2025 margin ambition.
  • Adjusted EBIT jumped by 39% to a record level of €5,489 million (2022: €3,959 million); all segments contributed with profit growth.
  • Revenue significantly increased by 10% to €55.9 billion (2022: €50.9 billion).
  • Industrial Business: Adjusted return on sales reached best ever 9.9% (2022: 7.7%), record level free cash flow of €2,811 million (2022: €1,746 million); earnings per share (EPS) of €4.62 (2022: €3.24).
  • Dividend: Proposal of €1.90 per share (2022: €1.30).
  • Robust outlook for 2024: Daimler Truck expects revenue and adjusted EBIT on 2023 level, adjusted ROS anticipated between 9.0% – 10.5%.

Daimler Truck delivered record level results in revenue, EBIT (earnings before interests and taxes), adjusted return on sales (ROS) and industrial free cash flow in 2023 and continues its path on further improving the Group’s overall profitability towards the 2025 ambition. Daimler Truck benefitted from a strong demand in its key commercial vehicle markets and further increased its unit sales, revenue, EBIT, industrial free cash flow (FCF) and earnings per share (EPS).

With 526,053 units, 1% more trucks and buses were sold worldwide in 2023 compared to prior-year level (520,291 units) – despite supply bottlenecks, which prevented even higher sales. The Company sold 3,443 zero-emission trucks and buses, 277% more than in the previous year (914 units). Supported by improved net pricing as well as positive volume and product mix effects in unit sales, the Group’s revenue increased by 10% to a record level of €55.9 billion in 2023 (previous year: €50.9 billion).

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2023 also showed a very positive development for earnings and return on sales, further driven by strong financial results in Q4. The adjusted EBIT jumped by 39% in 2023 to a record level of €5,489 million (2022: €3,959 million). With a peak of 10.6% in Q4, the adjusted ROS of the Industrial Business reached 9.9% in the full year 2023 (2022: 7.7%). Daimler Truck’s free cash flow of the Industrial Business rose by 61% to €2,811 million in the reporting year (2022: €1,746 million). Earnings per share (EPS) amounted to €4.62, up 43% compared to 2022. Amid a normalized ordering behavior, incoming orders in 2023 decreased by 18% compared to the previous year’s high level.

Daimler Truck CEO Martin Daum (left) and Claus Bässler, Vice President Treasury & Tax and acting Head of Finance & Controlling at Daimler Truck, present the financial results for 2023 at the Daimler Truck Annual Results Conference.

Martin Daum, Chairman of the Board of Management of Daimler Truck comments: “2023 was a record year with outstanding financial results. We achieved an adjusted operating profit of 5.5 billion euros and an adjusted return on sales in the Industrial Business of almost 10%. This means, we are in very close reach of our 2025 ambition. This is a great achievement our global Daimler Truck team can be very proud of. Going forward, we remain determined to unlock our full potential and to deliver strong profitability even in normalizing core markets.”

Transformation Milestones

Daimler Truck continuously keeps working towards the strategic ambitions to both lead the industry’s transformation to zero-emission transportation as well as to lead in sustained profitability. In 2023, the Company reached important milestones alongside this journey. Both product and service launches and strategic projects such as the joint ventures for battery cell production with Accelera by Cummins and PACCAR, and Greenlane for a public charging and hydrogen fueling network in North America illustrate Daimler Truck’s ambition to be a pacemaker of the industry.

In 2023, Daimler Truck expanded its global product portfolio to ten different zero-emission models. In North America, the new and fully-electric Freightliner eM2 was launched for urban delivery applications. In Europe, the battery-electric long-haul truck Mercedes-Benz eActros 600 celebrated its world premiere. Daimler Truck’s Asian affiliate FUSO handed over first units of its FUSO Next Generation eCanter to renowned customers like Japanese retail giant Yamato, and launched the battery-electric medium-duty RIZON trucks in the U.S. With the publicly acclaimed record run of the fuel cell Mercedes-Benz GenH2 Truck, which covered 1,047 kilometers with one fill of liquid hydrogen, Daimler Truck marked another milestone in its dual strategy of offering customers both battery- and hydrogen-powered trucks.

With the Mercedes-Benz eCitaro fuel cell, Daimler Buses introduced the first series-production electric bus with fuel cell as a range extender, providing a long range and high passenger capacity. The all-new Setra MultiClass 500 LE was launched 2023 to set new standards for low entry inter-city buses. Daimler Truck Financial Services completed its initial global rollout with the commencement of operations in France in 2023. The segment also started a cooperation in Romania and is now active in 17 markets worldwide with financial and mobility services. With a contract volume of €28.3 billion, the segment is one of the world’s largest financial services providers for commercial vehicles.

Dividend & Status Share Buy Back

For the 2023 financial year, the Board of Management and the Supervisory Board of Daimler Truck Holding AG will propose to the Annual General Meeting on May 15th, 2024, a dividend payment of €1.90 per share (2022: €1.30 per share).

On July 10th, 2023, the Board of Management of Daimler Truck Holding AG resolved, with the approval of the Supervisory Board, to launch a share buyback program. On this basis, own shares worth up to €2 billion (excluding incidental acquisition costs) will be acquired on the stock exchange over a period of up to 24 months. By December 31st, 2023, the Company repurchased 17,668,525 shares for €557 million.

Outlook for 2024

Due to the continued difficult economic conditions and the lack of catch-up effects, Daimler Truck expects the key truck markets to return to normal levels in 2024. From today’s perspective the Group anticipates the heavy-duty truck market in North America to range between 280,000 and 320,000 units (-16% to –3% vs. 2023) and the heavy-duty truck market in the region EU30 to amount between 260,000 and 300,000 units (-24% to –12% vs. 2023). Daimler Truck anticipates unit sales in 2024 in a range between 490,000 and 510,000 units (2023: 526,053 units).

The Group is expecting its revenue to range between €52 billion and €54 billion in the Industrial Business and between €55 billion and €57 billion on Group level. Daimler Truck is expecting its adjusted EBIT on prior year level. The adjusted ROS of the Industrial Business is anticipated to range between 9.0% and 10.5%. Daimler Truck is expecting a slight increase for the free cash flow of the Industrial Business in 2024.

Key Figures – Group and Segments

Group
 Q4
2023
Q4
2022
+/-FY
2023
FY
2022
+/-
Unit Sales140,132155,072-10%526,053520,2911%
Revenue*14,95014,7831%55,89050,94510%
EBIT (adjusted)*1,5591,02552%5,4893,95939%
ROS (adjusted, IB)**10.67.0 9.97.7 
Free Cash Flow (IB)*1,1731,836-36%2,8111,74661%
Incoming Orders107,969137,135-21%426,910522,837-18%
Earnings per Share (EPS) in €   4.623.2443%
Trucks North America
 Q4
2023
Q4
2022
+/-FY
2023
FY
2022
+/-
Unit Sales48,25650,007-4%195,014186,7794%
Revenue*5,9926,150-3%23,49222,0397%
EBIT (adjusted)*718731-2%2,8872,37921%
ROS (adjusted)**12.011.9 12.310.8 
Mercedes-Benz
 Q4
2023
Q4
2022
+/-FY
2023
FY
2022
+/-
Unit Sales44,70651,489-13%158,511166,369-5%
Revenue*5,6655,875-4%21,63820,2137%
EBIT (adjusted)*679302124%2,1991,62935%
ROS (adjusted)**12.05.1 10.28.1 
Trucks Asia
 Q4
2023
Q4
2022
+/-FY
2023
FY
2022
+/-
Unit Sales42,81247,735-10%161,171155,9673%
Revenue*1,9541,8565%7,0606,4999%
EBIT (adjusted)*1146771%33017193%
ROS (adjusted)**5.93.6 4.72.6 
Daimler Buses
 Q4
2023
Q4
2022
+/-FY
2023
FY
2022
+/-
Unit Sales7,6289,101-16%26,16824,0419%
Revenue*1,4491,24916%4,5663,68924%
EBIT (adjusted)*10146120%214141388%
ROS (adjusted)**7.03.7 4.70.4 
Financial Services
 Q4
2023
Q4
2022
+/-FY
2023
FY
2022
+/-
New Business*3,2192,9499%11,2679,42820%
Revenue*74257230%2,6741,75952%
EBIT (adjusted)*502695%21119310%
Return on equity (adjusted)**8.34.7 9.19.9 

*in millions of €
**in percent

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Itumeleng is the Managing Editor of The Auto Magazine. He is a tech and car enthusiast