Statement of income

The Group’s total revenue improved by 7.3% to €114.3 billion in 2012; adjusted for exchange-rate effects, it increased by 3.6%. The revenue growth primarily reflects higher shipments of vehicles by Mercedes-Benz Cars, increased unit sales by Daimler Trucks in North America and Asia, and the larger contract volume at Daimler Financial Services. Mercedes-Benz Vans posted a slight decrease in revenue. Revenue at Daimler Buses also decreased, as a result of lower unit sales of bus chassis. Further information on the development of revenue is provided in the "Business development" section of this Management Report. (See table 3.23)


Consolidated statement of income
  2012 2011 12/11
In millions of euros     % change
Revenue 114,297 106,540 +7
Cost of sales -88,784 -81,023 +10
Gross profit 25,513 25,517 .
Selling expenses -10,451 -9,824 +6
General administrative expenses -3,973 -3,855 +3
Research and non-capitalized development costs -4,179 -4,174 .
Other operating income 1,507 1,381 +9
Other operating expense -291 -355 -18
Share of profit/loss from investments accounted for using the equity method, net 990 273 .
Other financial income/expense, net -501 -208 -141
Earnings before interest and taxes (EBIT)1 8,615 8,755 -2
Interest income 828 955 -13
Interest expense -1,725 -1,261 +37
Profit before income taxes 7,718 8,449 -9
Income taxes -1,223 -2,420 -50
Net profit 6,495 6,029 +8
Profit attributable to non-controlling interest 400 362 +11
Profit attributable to shareholders of Daimler AG
6,095 5,667 +8
EBIT includes expenses from the compounding of provisions and effects from changes in discount rates (2012: minus €543 million; 2011: minus €225 million).

Cost of sales amounted to €88.8 billion in the year under review, increasing by approximately 10% compared with the prior year (2011: €81.0 billion). The increase in cost of sales was caused by higher business volumes and consequentially higher material costs. Personnel expenses and depreciation of property, plant and equipment also increased. At Financial Services, depreciation of equipment on operating leases increased in connection with the growing leasing business. Overall, cost of sales increased at a higher rate than revenue, so gross profit in relation to revenue fell to 22.3% (2011: 24.0%). Further information on cost of sales is provided in Note 5 of the Notes to the Consolidated Financial Statements. (See table 3.23)

Due to the growth in unit sales, selling expenses increased by €0.6 billion to €10.5 billion. The main factors here were higher expenses for marketing, personnel and IT services. As a percentage of revenue, selling expenses decreased from 9.2% to 9.1%. (See table 3.23)

General administrative expenses increased to €4.0 billion (2011: €3.9 billion). The increase was partially due to higher costs for IT and consulting services. As a percentage of revenue, general administrative expenses decreased slightly to 3.5% (2011: 3.6%). (See table 3.23)

Research and non-capitalized development costs were unchanged compared with the prior year at €4.2 billion in 2012. They were mainly related to advance expenditure for the development of new models, the renewal of existing models, and the further development of drive systems and safety technologies. As a proportion of revenue, research and development costs decreased from 3.9% to 3.7%. Further information on the Group’s research and development costs is provided in the “Research and development, environmental protection” section of this Management Report. (See table 3.23)

Other operating income increased to €1.5 billion (2011: €1.4 billion). The increase was mainly due to higher income from services charged to third parties. (See table 3.23)

Other operating expense decreased slightly to €0.3 billion (2011: €0.4 billion). (See table 3.23)

Further information on the composition of other operating income and expense is provided in Note 6 of the Notes to the Consolidated Financial Statements.

In 2012, our share of profit from investments accounted for using the equity method improved to €1.0 billion (2011: €0.3 billion). The increase primarily reflects the sale of 7.5% of the shares of EADS. (See table 3.23)

Other financial expense increased from €0.2 billion in 2011 to €0.5 billion in 2011. This is mainly due to higher expenses from the compounding of provisions and effects from changes in discount rates of €0.5 billion (2011: €0.2 billion). (See table 3.23)

The Group recorded a net interest expense of €0.9 billion (2011: €0.3 billion). The causes of the higher interest expense were higher expenses in connection with pension and health-care obligations and an increase in other interest expenses. The prior-year figure includes positive effects from interest-rate hedging instruments. (See table 3.23)

The income tax expense for 2012 of €1.2 billion (2011: €2.4 billion) decreased partially due to the lower pre-tax profit. Profit before income taxes in 2012 includes the mainly tax-free gain on the sale of EADS shares. Both years were affected by tax benefits from the reversal of impairments recognized on deferred tax assets and 2012 was also affected by tax benefits from the tax assessment of prior years. The effective tax rate in 2012 was 15.8% (2011: 28.6%). (See table 3.23)

Net profit for the year amounts to €6.5 billion (2011: €6.0 billion), of which €400 million is attributable to non-controlling interest of subsidiaries (2011: €362 million). Net profit attributable to shareholders of Daimler AG amounts to €6.1 billion (2011: €5.7 billion), representing earnings per share of €5.71 (2011: €5.32). (See table 3.23)

The calculation of earnings per share (basic) is based on an average number of outstanding shares of 1,066.8 million (2011: 1,066.0 million).