BMW Books Earnings Gain in 2Q Due Development in EU Antitrust Proceedings

By Kim Richters

BMW AG said Thursday that progress in E.U. antitrust proceedings is leading to the partial release of related provisions, resulting in a positive effect on earnings of 1 billion euros ($1.22 billion) in the second quarter.

The company said these proceedings are looking into whether carmakers in Germany have cooperated in technical working groups to limit competition for the development and rollout of emission-reduction technologies. "The legal conformity of diesel vehicles is not subject of the proceedings," said the car maker.

It has booked a total provision of EUR1.4 billion in April 2019 related to this case.

"Based on the new information, BMW AG continues to consider it more likely than not that the EU Commission will issue a fine to BMW AG. However, the significant limitation in the scope of the allegations has led to a revaluation of the provision," it said.

The provision release hasn't been included in the current outlook for the year and will lead to an increase in the margin for earnings before interest and taxes for its automotive segment of around 1 percentage point, BMW said, adding that it will adjust the forecast range. Profit before taxes for the group should still see a significant increase this year as previously expected.

Write to Kim Richters at [e-mail]

(END) Dow Jones Newswires

May 20, 2021 13:23 ET (17:23 GMT)

Copyright (c) 2021 Dow Jones & Company, Inc.