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Solid business figures for 2022 confirm BMW Group strategy

The BMW Group met its targets for 2022, as forecasted, and thus delivered a strong operating performance in a difficult business environment. The premium manufacturer significantly increased Group EBT (€ 23,509 million/ +46.4%) and net profit (€ 18,582 million/ +49.1%) from the previous year.

Finance, Facts, Figures
·
Corporate
 
  • High Group EBT: € 23.5 billion – EBT margin: 16.5%
  • Automotive EBIT: € 10.6 billion – EBIT margin on target at 8.6% (excluding effects of BBA full consolidation:11.2%)
  • Strong free cash flow (automotive): € 11.1 billion
  • CO2 emissions of EU new vehicle fleet at 105.0 g/km (WLTP) – well below applicable emission target (127.5 g/km)
  • Dividend of € 8.50 per share of common stock proposed
  • Zipse: “We achieved solid performance under volatile conditions”

 

Munich. The BMW Group met its targets for 2022, as forecasted, and thus delivered a strong operating performance in a difficult business environment. The premium manufacturer significantly increased Group EBT (€ 23,509 million/ +46.4%) and net profit (€ 18,582 million/ +49.1%) from the previous year. This positive development can be attributed to improved pricing and positive product-mix effects, as well as the full consolidation of the Chinese joint venture, BMW Brilliance Automotive Ltd. (BBA). The latter also made a large cash contribution (€ 5,011 million) on 11 February 2022 to a significantly higher free cash flow of € 11,071 million in the Automotive Segment.

 

Rising sales of fully-electric models, which were up 107.7% in 2022, accounted for 9% of deliveries in 2022 and helped further lower the CO2 emissions value of the new vehicle fleet in the EU. Based on preliminary calculations, this figure came in at 105.0 grams of CO2 per km (WLTP). This represents a decrease of (-)9.4% – significantly outperforming the value for the previous year and the applicable emissions target by 22.5 g/km (prev. yr.: 115.9 g/km). The BMW Group is forging ahead with electrification of its product lineup and aims to raise the share of fully-electric vehicles in its total deliveries to 15% this year.

 

“There are two essential elements to our success in 2022: a strong and passionate team effort by our entire workforce worldwide – and compelling products that provide us with the right response to a persistently challenging environment,” said Oliver Zipse, Chairman of the Board of Management of BMW AG, on Thursday in Munich. “It shows that those who tackle the transformation with courage and consistency, while maintaining a high level of flexibility, can achieve solid performance, even under volatile conditions. We will continue on this BMW path in the future as we steer the company further along the road to success.”

 

Positive effects for Group from full consolidation of BBA

 

In financial year 2022, the BMW Group once again outperformed its main financial key figures for the previous year, reporting significant growth in revenues, Group earnings and net profit.

 

As expected, deliveries were slightly lower than the previous year, at 2,399,632 units (prev. yr.: 2,521,514 vehicles/ -4.8%). Consistently high customer demand was reflected in the company’s strong order book. However, this could not be entirely fulfilled, due to difficulties with the supply of semiconductor components, supply chain disruptions and COVID lockdowns in China.

 

Electrified vehicles –BEVs and PHEVs –accounted for a total of 18.1% (433,792 units/ +32.1% YOY) of deliveries. Sales of fully-electric cars reached 215,752 units – a significant increase compared to the previous year (+107.7% YOY).

 

Group revenues climbed to € 142,610 million (prev. yr.: € 111,239 million/ +28.2%), with integration of BBA revenues making a significant contribution to growth. The BMW Group also benefited from improved pricing – for both new vehicle sales and the resale of end-of-lease vehicles – as well as positive product-mix effects.

This was offset to a significant extent by BBA’s cost of sales, which was recognised for the first time. The increase in costs for materials, commodities and logistics, higher refinancing costs due to higher interest levels as well as effects from the consolidation of BBA and a larger percentage of electrified vehicles, all contributed to higher costs.

 

R&D spending for new models and GEN 6 electric drive trains

 

The continuing transformation of the BMW Group is reflected in the moderate increase in research and development spending: R&D costs in accordance with IFRS totalled € 6,624 million (prev. yr.: € 6,299 million/ +5.2%). R&D expenditure is mainly driven by new models, the NEUE KLASSE and the associated development of the sixth generation of electric drive trains. Additional investments were also made in digitalisation of the vehicle fleet and automated driving.

However, with revenues up year-on-year, the R&D ratio, according to the German Commercial Code, was lower, at 5.0% (prev. yr.: 6.2%).

 

Capital expenditure for property, plant and equipment and other intangible assets amounted to € 7,791 million in 2022 (prev. yr.: € 5,012 million/ +55.4%). This increase reflects the consolidation of BBA investments and capital expenditure for new models like the BMW 7 Series and the BMW X1. Additional funds were channelled into the accelerated BEV ramp-up. The capex ratio stood at 5.5%.

 

The BMW Group reported earnings before financial result of 13,999 million for the full year(prev. yr.: € 13,400 million/ +4.5%). Group earnings before tax once again saw a strong increase and, as a result of the full consolidation of BBA, reached very solid € 23,509 million (prev. yr.: € 16,060 million/ +46.4%). The Group EBT margin came in at 16.5% (prev. yr.: 14.4%; +2.1 percentage points).

 

Group net profit totalled € 18,582 million (prev. yr.: € 12,463 million/ +49.1%).

 

Dividend of € 8.50 proposed

 

Shareholders will also participate in the success of financial year 2022. Subject to the approval of the Annual General Meeting, thecompany’s unappropriated profit (according to the German Commercial Code) of € 5,481 million (prev. yr.: € 3,827 million/ +43.2%) will be distributed to shareholders from BMW AG’s net profit. The Board of Management and Supervisory Board will propose a dividend of € 8.50 per share of common stock (prev. yr. € 5.80) and € 8.52 per share of preferred stock (prev. yr. € 5.82) to the Annual General Meeting on 11 May. This represents a preliminary payout ratio of 30.6% (prev. yr.: 30.9%, cf. glossary) and is in line with the target range of 30-40% of net profit attributable to shareholders of BMW AG for the payout ratio.

 

Share buy-back of € 1.28 billion completed in 2022

 

On the basis of the authorization granted by the Annual General Meeting in May 2022, the Board of Management has decided to repurchase shares in the amount of up to € 2 billion. As of December 2022, around 15.3 million common shares for €1,172 million and around 1.4 million preferred shares for €106 million had been repurchased and reported as own shares. These were recognised as treasury shares. BMW AG thus holds around 16.8 million treasury shares as of 31 December 2022, with a nominal value of € 16,760,957 or 2.53% of the share capital. As of March 7 2023, the BMW Group bought back shares worth almost € 1.6 billion and thus holds 3.03% of the share capital.

“All our stakeholders will benefit from our company’s success and in line with our announcements. Our solid dividend of € 8.50 for 2022 reflects our financial strength – as we are able to pay out dividends in parallel with our necessary high level of investment in the transformation of the company,” according to Nicolas Peter, member of the Board of Management of BMW AG responsible for Finance.

 

Full consolidation of BBA has major impact in Automotive Segment 

 

The Automotive Segment benefited once again in 2022 from increased sales of high-revenue models, better pricing and continuing positive development in used car markets. Improved pricing and a higher-value product mix, as well as increased business from new parts and accessories, all lifted revenues – which also benefited from currency tailwinds.

Due to the full consolidation of BBA, segment revenues were significantly higher, at € 123,602 million (prev. yr.: € 95,476 million/ +29.5%). The cost of sales also rose significantly: on the one hand, resulting from higher effects from the full consolidation of BBA – such as depreciation and amortisation from the purchase price allocation of around € 1.8 billion and elimination of interim profits totalling around € 1.3 billion. On the other, the cost of sales was also negatively impacted by significantly higher material and logistics costs, especially due to the limited availability of semiconductors and supply chain disruptions, as well as increases in raw material and energy prices.

Earnings before financial result (EBIT) for the reporting year amounted to € 10,635 million (prev. yr. € 9,870 million/ +7.8%). At 8.6% (prev. yr.: 10.3%; -1.7 percentage points), the EBIT margin for the segment was at the high end of the guidance range of 7-9%.

Without the aforementioned effects of € 3.1 billion from the full consolidation of BBA the EBIT margin would have come in at 11.2%.

The segment’s financial result of 8,283 million was significantly higher year-on-year (prev. yr.: € 1,935 million/ +328.1%). This strong increase during the reporting year largely stems from the effects of the revaluation of previously held equity shares in BBA of just under € 7.7 billion in the other financial result.

Segment earnings before tax (EBT) for financial year 2022 totalled € 18,918 million and were therefore significantly higher than the figure for the previous year (prev. yr.: € 11,805 million/ +60.3%).

Free cash flow in the Automotive Segment reached very solid € 11,071 million (prev. yr.: € 6,354 million/ +74.2%) at year end.

 

Return on capital employed (RoCE) for the automotive segment in 2022 was well within the target range of 14-19% at 18.1% (prev. yr.: 24.0%/ -5.9 percentage points).

 

“The integration of our Chinese joint venture into the Automotive Segment takes our business operations to a new level. In 2022, this gave us a significant tailwind. We continue to hold a strong position in the major regions of the world with a strong product lineup, and we will keep on benefitting in particular this year from demand for our electrified vehicles and top-end models,” said Nicolas Peter, member of the Board of Management of BMW AG responsible for Finance, on Thursday in Munich.

 

More competition and changes in risk situation for Financial Services

 

Intense competition, higher interest rates and inflation, as well as limited availability of vehicles, impacted new business in the financial services sector in 2022. The total volume of new business from financing and leasing contracts with retail customers was down (-)12.6% to € 55,449 million (prev. yr.: € 63,414 million). The percentage of BMW Group new vehicles leased or financed by the Financial Services Segment stood at 41.0% for 2022 (prev. yr.: 50.5%/ -9.5 percentage points). Better transaction prices and an improved product mix resulted in a higher average financing volume per vehicle during the reporting period.

 

Pre-tax earnings (EBT) in the Financial Services Segment totalled € 3,205 million at the end of the reporting year (prev. yr.: € 3,753 million/ -14.6%) ‒ with the previous year being characterized by an exceptionally positive risk situation. Higher provisions for credit risks were made during the reporting year in response to geopolitical uncertainties and a weaker macroeconomic outlook.

 

As a consequence of the lower earnings before tax, the Financial Services Segment achieved a return on equity (RoE) of 17.9% (prev. yr.: 22.6%/ -4.7 percentage points), fully in line with the company’s adjusted guidance of 17-20% (adjusted from 14-17% in the Q2/2022 quarterly statement).

 

Electrification offensive and continued growth for BMW Motorrad

 

In 2022, BMW Motorrad pressed ahead with electrification of the brand in the field of urban mobility, with the series introduction of the BMW CE 04 electric scooter. Deliveries in the Motorcycles Segment reached a new all time-high of 202,895 units in 2022 (prev. yr.: 194,261 units/ +4.4%). Although performance in the European markets, with the exception of France (+6.7% YOY), was less dynamic, sales in China (+7.7% YOY) saw a solid increase, and deliveries in the Americas rose significantly (+14.4% YOY).

 

Business performance benefited from this sales growth, combined with positive pricing and product mix effects. Higher material and logistics costs impacted the Motorcycles Segment during the reporting year.

 

The segment posted revenues of 3,176 million (prev. yr.: € 2,748 million/ +15.6%), with an EBIT of 257 million (prev. yr.: € 227 million/ +13.2%). The EBIT margin came in at 8.1% (prev. yr.: 8.3%/ -0.2 percentage points) and is therefore within the guidance range of 8-10%.

 

The higher earnings pushed up the return on capital employed (RoCE) to 24.9% which was slightly above the planned range of 19-24% (prev. yr.: 21.9%/ +3 percentage points).

 

BMW Group posts successful fourth quarter

 

In the fourth quarter of 2022, numerous lockdowns led to production cutbacks and the closure of Chinese dealerships. At the same time, the slight easing of the semiconductor component shortage contributed to higher production and sales volumes overall.

 

During this period, deliveries of the three premium automotive brands BMW, MINI and Rolls-Royce climbed significantly to 651,794 units (prev. yr.: 589,290/ +10.6%). The effects of expanded electrified model range were clearly visible in the fourth quarter: With 150,508 electrified vehicles sold, their share of total sales volumes climbed to 23%. Group revenues totalled € 39,522 million (prev. yr.: € 28,408 million/ +39.1%).

 

Group profit before tax for the fourth quarter increased significantly to € 3,253 million (prev. yr.: € 2,907 million/ +11.9%), while the EBT margin came in at 8 .2%. Group net profit for the same period totalled € 2,175 million (prev. yr.: € 2,256 million/ -3.6%).

 

Automotive Segment EBIT was significantly higher, at 2,932 million (prev. yr.: € 1,925 million/ +52.3%), due to the effects of the full consolidation of BBA and higher sales volumes. The Automotive Segment EBIT margin for the final quarter of the year was 8.5% (prev. yr.: 7.7%). The segment's free cash flow totalled € 1,195 million (prev. yr.: € 55 million).

 

Due to higher refinancing costs and increased credit risk provisioning, the Financial Services Segment reported lower pre-tax earnings of € 533 million (prev. yr.: € 829 million/ -35.7%).

 

Employee numbers significantly higher year-on-year

 

The BMW Group had 149,475 employees at the end of 2022 (prev. yr.: 118,909/ +25.7%). This significant increase is primarily due to the full consolidation of BMW Brilliance Automotive Ltd., with almost 26,000 employees integrated into the BMW Group. The further increase in employee numbers across all segments was mainly in the areas of development and IT, as well as in the BMW Group’s global production network.

 

Proposed re-election of Supervisory Board member

 

The current mandate of Supervisory Board member and Chairman of the Audit Committee Dr Kurt Bock will come to an end at the Annual General Meeting on 11 May 2023. The Supervisory Board will propose re-electing Bock for another four-year mandate at the Annual General Meeting. The candidate is considered independent by the Supervisory Board.

* * *

 

You will receive further information on the Group Financial Statement 2022 and the outlook for the current financial year at the BMW Group Annual Conference on 15 March 2023. You can follow the virtual event live on the internet at: https://www.live.bmwgroup.com/en/live-streaming/. The BMW Group Report 2022 will be published on 15 March at 7.30 a.m. (CET) at https://www.bmwgroup.com/en/investor-relations/company-reports.html

 

 

The BMW Group – an overview

2022

2021

Change in %

Deliveries to customers

    

Automotive 1

units

2,399,632

2,521,514

-4.8

thereof:  BMW

units

2,100,689

2,213,790

-5.1

 MINI

units

292,922

302,138

-3.1

 Rolls-Royce

units

6,021

5,586

7.8

Motorcycles

units

202,895

194,261

4.4

 

 

 

 

 

Employees                                    (compared to 31 Dec. 2021)

149,475

118,909

25.7

 

 

 

 

 

Automotive Segment EBIT margin

percent

8.6

10.3

-1.7%age points

Motorcycles Segment EBIT margin

percent

8.1

8.3

-0.2%age points

EBT margin BMW Group 2

percent

16.5

14.4

2.1%age points

 

 

 

 

 

Revenues

€ million

142,610

111,239

28.2

thereof:   Automotive

€ million

123,602

95,476

29.5

Motorcycles

€ million

3,176

2,748

15.6

Financial Services

€ million

35,122

32,867

6.9

Other Entities

€ million

8

5

60.0

Eliminations

€ million

-19,298

-19,857

-2.8

 

 

 

 

 

Profit before financial result (EBIT)

€ million

13,999

13,400

4.5

thereof:   Automotive

€ million

10,635

9,870

7.8

Motorcycles

€ million

257

227

13.2

Financial Services

€ million

3,163

3,701

-14.5

Other Entities

€ million

-203

-8

-

Eliminations

€ million

147

-390

-

 

 

 

 

 

Profit before tax (EBT)

€ million

23,509

16,060

46.4

thereof:   Automotive

€ million

18,918

11,805

60.3

Motorcycles

€ million

269

228

18.0

Financial Services

€ million

3,205

3,753

-14.6

Other Entities

€ million

995

531

87.4

Eliminations

€ million

122

-257

-

 

 

 

 

 

Income taxes

€ million

-4,927

-3,597

37.0

Net profit

€ million

18,582

12,463

49.1

Earnings per share (common/preferred share)

 €

27,31/27,33

18.77/18.79

45.5/45.4

1 including joint venture BMW Brilliance Automotive Ltd., Shenyang (1 January to 10 February 2022: 96,133 vehicles, 2021: 651,236 vehicles, 2020: 602,247 vehicles, 2019: 538,612 vehicles, 2018: 455,581 vehicles, 2017: 385,705 vehicles).

2 Ratio of Group earnings before taxes to Group revenues.

 

 

The BMW Group – an overview

Q4 2022

Q4 2021

Change in %

Deliveries to customers

    

Automotive 1

units

651,794

589,290

10.6

thereof:  BMW

units

566,823

510,722

11.0

 MINI

units

83,651

77,300

8.2

 Rolls-Royce

units

1,320

1,268

4.1

Motorcycles

units

43,562

37,652

15.7

 

 

 

 

 

Employees                                            (compared to 31 Dec. 2021)

149,475

118,909

25.7

 

 

 

 

 

Automotive Segment EBIT margin

percent

8.5

7.7

0.8%age points

Motorcycles Segment EBIT margin

percent

-9.4

-19.8

10.4%age points

EBT margin BMW Group 2

percent

8.2

10.2

-2.0%age points

 

 

 

 

 

Revenues

€ million

39,522

28,408

39.1

thereof:   Automotive

€ million

34,571

25,103

37.7

Motorcycles

€ million

691

486

42.2

Financial Services

€ million

9,086

8,688

4.6

Other Entities

€ million

2

2

0

Eliminations

€ million

-4,828

-5,871

17.8

 

 

 

 

 

Profit before financial result (EBIT)

€ million

3,500

2,487

40.7

thereof:   Automotive

€ million

2,932

1,925

52.3

Motorcycles

€ million

-65

-96

32.3

Financial Services

€ million

536

832

-35.6

Other Entities

€ million

-16

-5

-

Eliminations

€ million

113

-169

-

 

 

 

 

 

Profit before tax (EBT)

€ million

3,253

2,907

11.9

thereof:   Automotive

€ million

3,009

2,149

40.0

Motorcycles

€ million

-57

-96

40.6

Financial Services

€ million

533

829

-35.7

Other Entities

€ million

-263

153

-

Eliminations

€ million

31

-128

-

 

 

 

 

 

Income taxes

€ million

-1,078

-651

65.6

Net profit

€ million

2,175

2,256

-3.6

Earnings per share (common/preferred share)

 €

3.43/3.44

3.39/3.40

1.2/1.2

1 including the joint venture BMW Brilliance Automotive Ltd., Shenyang.

2 Ratio of Group earnings before taxes to Group revenues.

 

 

GLOSSARY – explanatory comments on key performance indicators

 

Deliveries to customers
A new or used vehicle is recorded as a delivery once it is handed over to the end user (which also includes leaseholders under lease contracts with BMW Financial Services). In the US and Canada, end users also include (1) dealers when they designate a vehicle as a service loaner or demonstrator vehicle and (2) dealers and other third parties when they purchase a company vehicle at auction and dealers when they purchase company vehicles directly from the BMW Group. Deliveries may be made by BMW AG, one of its international subsidiaries, a BMW Group retail outlet, or independent third-party dealers. The vast majority of deliveries – and hence the reporting of deliveries to the BMW Group – is made by independent third-party dealers. Retail vehicle deliveries during a given reporting period do not correlate directly to the revenues that the BMW Group recognises in respect of that particular reporting period.

 

EBIT

Profit before financial result. Profit before financial result comprises revenues less cost of sales, less selling and administrative expenses and plus/minus net other operating income and expenses.

 

EBIT margin

Profit/loss before financial result as a percentage of revenues.

 

EBT

EBIT plus financial result.

 

Payout ratio (see page 4)

The payout ratio is preliminary. Although the Management Board and Supervisory Board are proposing a fixed dividend per share to the general meeting, the number of dividend-entitled shares is expected to fall even further as a result of the ongoing share buy-back program between now and the Annual General Meeting. Accordingly, the total amount paid out to shareholders until May 11 presumably will also change.

 

 

If you have any questions, please contact:

 

Corporate Communications

 

Dr Britta Ullrich, Communications Finance

Email: britta.ullrich@bmwgroup.com, Telephone: +49-89-382-18364

 

Eckhard Wannieck, head of Communications Corporate, Finance, Sales

Email: eckhard.wannieck@bmwgroup.com, Telephone: +49 89 382-24544

 

Media website: www.press.bmwgroup.com/global

Email: presse@bmwgroup.com

 

 T he 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 over 30 production sites worldwide; the company has a global sales network in more than 140 countries.

In 2022, the BMW Group sold nearly 2.4 million passenger vehicles and more than 202,000 motorcycles worldwide. The profit before tax in the financial year 2022 was € 23.5 billion on revenues amounting to € 142.6 billion. As of 31 December 2022, the BMW Group had a workforce of 149,475 employees.

The success of the BMW Group has always been based on long-term thinking and responsible action. The company set the course for the future at an early stage and consistently makes sustainability and efficient resource management central to its strategic direction, from the supply chain through production to the end of the use phase of all products.

 

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BMW Group Streaming

AUTO CHINA 2024.

Beijing. 24/25 April 2024.

Here you can see the Webcasts of the BMW Group Night and Press Conference at the Auto China 2024; with the World Premieres of the new MINI Aceman and the new BMW i4.

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CO2 emission information.

Fuel consumption, CO2 emission figures and power consumption and range were measured using the methods required according to Regulation VO (EC) 2007/715 as amended. They refer to vehicles on the German automotive market. For ranges, the NEDC figures take into account differences in the selected wheel and tyre size, while the WLTP figures take into account the effects of any optional equipment.

All figures have already been calculated based on the new WLTP test cycle. NEDC figures listed have been adjusted to the NEDC measurement method where applicable. WLTP values are used as a basis for the assessment of taxes and other vehicle-related duties which are (also) based on CO2 emissions and, where applicable, for the purposes of vehicle-specific subsidies. Further information on the WLTP and NEDC measurement procedures is also available at www.bmw.de/wltp.

For further details of the official fuel consumption figures and official specific CO2 emissions of new cars, please refer to the “Manual on the fuel consumption, CO2 emissions and power consumption of new cars”, available at sales outlets free of charge, from Deutsche Automobil Treuhand GmbH (DAT), Hellmuth-Hirth-Str. 1, 73760 Ostfildern-Scharnhausen and at https://www.dat.de/co2/.

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