FRANKFURT (Bloomberg) -- Daimler cut its 2013 profit forecast after its quarterly earnings fell 56 percent, burdened by Europe's slump and weaker Mercedes-Benz sales in China.
First-quarter earnings before interest and taxes (EBIT) declined to 917 million euros ($1.2 billion) from 2.1 billion euros a year earlier, Daimler said today in a statement.
EBIT this year will fall rather than match last year's 8.1 billion euros ($10.6 billion) as previously predicted, the company said.
"In the first three months of this year, many markets developed worse than expected for economic reasons, especially western Europe," CEO Dieter Zetsche said in the statement.
First-quarter profit at Daimler's Mercedes cars division fell 63 percent to 460 million euros as revenue slipped 6 percent to 14.1 billion euros. The unit's return on sales declined to 3.3 percent from 8.2 percent a year ago. Daimler predicted the unit's earnings will fall for the full year.
Chief Financial Officer Bodo Uebber warned there could still be setbacks to business in Europe this year. "The crisis is not yet over and that is having a negative effect on investments and purchasing behavior," he told journalists during a conference call.
Christian Ludwig, an analyst with Bankhaus Lampe. said: "The results are a little disappointing. This year will probably be another transition year, which will not have any positive impulses for the share price. (Daimler's) guidance remains quite vague."
Daimler still expects earnings to improve in the second half of the year as the newly introduced Mercedes CLA four-door coupe-styled compact and a revamped version of the E class attract drivers.
Second-quarter results at Daimler should be better than numbers achieved during the first three months, Uebber said today during a conference call.