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BMW AG (BMW.XE) Wednesday said it swung to a EUR153 million first-quarter net loss as demand for luxury cars stalled amid recession, and said that it's still impossible to give a reliable forecast for the full year due to volatile markets.
"In view of the difficult conditions still prevailing on the financial markets, we remain focused in our efforts to improve our liquidity position," BMW Chief Executive Norbert Reithofer said in a statement.
The world's best-selling premium automaker posted a net profit attributable to shareholders of EUR485 million in the first three months last year.

On a telephone conference with reporters, Reithofer declined to say whether the first quarter was the trough in 2009. "There are still no signs that markets have stabilized," he said. Other industry executives recently have signaled that sales and earnings should gradually improve in the course of the year.
BMW's closely watched earnings before interest and tax, or EBIT, swung to a EUR55 million loss from EUR827 million profit in 2008, as first-quarter revenue declined 13% on the year to EUR11.5 billion from EUR13.3 billion.
Both figures beat market expectations. Analysts had expected BMW to post an EBIT loss of EUR275 million and revenue of EUR10.5 billion.

At 0914 GMT, BMW shares traded up EUR1.68, or 6%, at EUR29.17, while the blue-chip DAX index traded up 0.5%.
BMW said it streamlined cost structures further during the first three months of the year, reduced inventories and cut back working capital in the auto segment. BMW slashed production 34% in the first quarter to 267,637 cars.
"We were able to generate a positive free cash flow of EUR220 million," Reithofer said. BMW's liquidity stood at EUR10 billion at the end of the first quarter.

It reiterated that vehicle sales are expected to fall in 2009 amid a fall of the overall market between 10% and 20%. The Munich-based company views 2009 as a year of "transition," before several important new model launches are expected to fuel demand again from 2010 onward.
Total sales of the company's BMW, Mini and Rolls-Royce brand cars were down 21% on the year at 277,264 vehicles from 351,787 vehicles in the first quarter last year.
Reithofer told reporters in March that he would focus this year on liquidity rather than profitability and aimed to keep a close eye on the company's inventories, reducing fixed costs and optimizing working capital.

A BMW spokesman said the company didn't increase risk provisioning in the first quarter. Higher provisions and allowances for residual value risks and bad debts relating to its financial-services business had been a major concern for BMW last year and shaved EUR1.97 billion from 2008 earnings.

BMW's first-quarter loss mirrors lower earnings at its rivals as major auto markets around the globe contracted in the first three months of the year amid recession, with demand for luxury cars particularly hard hit.


Last week, Daimler AG's (DAI) Mercedes-Benz Cars division posted a worse-than-expected EUR1.12 billion first-quarter EBIT loss.

Volkswagen AG's (VOW.XE) Audi AG (NSU.XE) premium unit posted a 29% fall in first-quarter earnings year-on-year but remained in the black with operating profit of EUR363 million. Audi has been less affected by the industry gloom due to a favorable regional sales mix and the recent launch of several important new or revamped models.

http://online.wsj.com/article/BT-CO-...06-705459.html