FRANKFURT (Reuters) - German carmaker BMW BMWG.DE reported a better than expected operating profit on Wednesday thanks to healthy sales of high-margin sports utility vehicles, but disappointed on the dividend.
Group earnings before interest and tax (EBIT) rose to 9.59 billion euros ($10.5 billion), above the average forecast of 9.55 billion euros given in a Reuters poll of analysts and giving the producer of BMW and Mini cars an operating margin in its automotive division of 9.2 percent.
Last year BMW retained the title of world’s biggest luxury carmaker, with sales of BMW-branded cars reaching 1.91 million, a 5.2 percent rise on the previous year and the 11th year in a row since the Munich-based company first won the title in 2005.
BMW Chief Executive Harald Krueger said the company aimed to continue increasing sales.
“We are again targeting a new sales volume record in 2016, with sales expected to be slightly up on the previous year,” Krueger said in a statement on Wednesday.
BMW said it would recommend a dividend of 3.20 euros per share of common stock and 3.22 euros for preferred stock, which was below the 3.38 euros per share expected in the poll.
Analysts at Evercore ISI said results beat market expectations although the lack of any announcements about higher dividend payments were disappointing.
“The lack of any special dividend and the flat payout ratio disappoint,” Evercore’s Arndt Ellinghorst said.
Reporting by Edward Taylor; Editing by Jonathan Gould