Profit, Impending Sale for Daimlerchrysler

by : Dwyane Thomas

The world's fifth-largest car manufacturer, DaimlerChrysler AG, is expected to report a net profit of four times more than the first quarter. At the same time, Chrysler Group seems to announce a painful loss regarding future sales.

Based on the review of eight analysts in a Dow Jones Newswires survey, DaimlerChrysler is expected to announce its 1.39 billion euros ($1.88 billion) net profit for the first quarter of 2007. This is indeed a huge increase from last year's 299 million euros.

For the first time, DaimlerChrysler is expected to post its earnings under International Financial Reporting Standards (IFRS).

This year, the Mercedes division is anticipated to announce Earnings Before Interest and Taxes (EBIT) for the first quarter that amounted to 759 million euro ($1 billion). Last year, the division had a 678 million euro loss. This was incited by a wide-ranging reorganizing program.

Eight hundred fifty six (856) million euros or $1.2 billion is the expected loss of Chrysler in the first quarter. Last year, the company had a 119 million euro operating profit.

According to the eight analysts in a Dow Jones Newswires survey, the effects linked to the reorganized accounting standard contributed to DaimlerChrysler's strong elevation of net profit.

DaimlerChrysler AG will substitute its operating profit under U.S. GAAP with Earnings Before Interest and Taxes (EBIT).

The company said it is anticipating slightly higher sales in this year after it has sold 4.7 million vehicles last year. DaimlerChrysler AG is also expecting that revenues for this year will amount to about 152.8 billion euros, similar to that of last year.

DaimlerChrysler AG fans are very much eager to know the status of the ongoing talks about Chrysler's future. Three months ago, DaimlerChrysler announced that all alternatives were open for Chrysler's future. It had later confirmed that it is currently under negotiations with possible company partners.

The company however will still let its customers wait on the current condition of the talks. DaimlerChrysler AG has not yet given any further information on the current status of the talks.

Among the bidders are Canadian auto supplier Magna International Inc. with partner Onex Corp., as well as private-equity firms Cerberus Capital Management and a team of Blackstone Partners and Centerbridge Capital, and the billionaire investor Kirk Kerkorian.

About DaimlerChrysler
A German car corporation DaimlerChrysler AG is the fifth largest car manufacturer in the world. DaimlerChrysler produces and supplies trucks and provides financial services through its DaimlerChrysler Financial Services arm. It also owns a big time stake in aerospace group EADS.

The company was established in 1998 after Daimler-Benz's merging with Chrysler Corporation USA. It manufactures automobiles under the brands Dodge, Chrysler, Jeep, Smart, Maybach, GEM, and Mercedes-Benz, a car known for its safety features like durable .