Business Briefs

DaimlerChrysler Profits Up

The German-American carmaker DaimlerChrysler announced rising profits for the first quarter of 2003 on Thursday, despite slumping sales. Operating profit in the first three months of 2003 hit €1.4 billion ($1.53 billion), an increase over the same period last year of 38 percent. But the firm cautioned that increased competition in North American markets would make it "difficult to achieve the aim of an operating profit of €2 billion this year." DaimlerChrysler sold 1.0 million vehicles worldwide in the first quarter of 2003. This figure was 5% lower than in the first quarter of 2002, due to weaker demand in major markets.

Deutsche Bank Expects Losses

Deutsche Bank AG, Germany's largest bank, warned on Thursday that it would post a first-quarter net loss after taking more than a billion euros in charges for the sinking value of investments. The bank said it expected to post a net loss of around €200 million ($220 million) and a pre-tax profit of €225 million. Last year, Deutsche Bank posted a net profit of €597 million. Deutsche announced charges of €1.25 billion due to the sinking value of its 34.5 percent share in beleaguered German insurer, Gerling which the bank has been trying to sell. These charges will be partly offset by a €500 million gain from disposals.

Siemens says it's on track for 2003 target

German Industrial giant, Siemens, said on Thursday that it was on track to reach their 2003 targets, but warned that spending in major markets was slow after they posted a decrease in second quarter sales and profits. Munich-based Siemens posted a net profit of €568 million ($625 million) for the second quarter of 2003, down from the €1.28 billion after tax profit the firm posted for the same period last year. Siemen Chief Executive, Heinrich von Pierer told a news conference that "the investment climate in key industries in important regional markets continues to be weak," and warned that the firm saw no sign of a comprehensive improvement at the moment. Pierer said Siemens expected revenues would decline for the full fiscal year

OECD: Germany to exceed deficit limit

The Organization for Economic Cooperation and Development (OECD) warned on Thursday that Germany's budget deficit would continue to rise this year and again exceed the 3 percent of gross domestic product limit established by the European Union’s Growth and Stability Pact. "With domestic demand having firmed somewhat at the turn of the year, the trough of the downswing might have been reached. But the economy seems likely to grow very slowly through 2003, as consumption and investment remain subdued and a significant pick up in exports in unlikely before 2004," the OECD said. Europe's largest economy is expected to grow by only 0.3 percent this year and 1.7 percent next year. Without any corrective action taken by the government, the OECD said that Germany's budget deficit would reach 3.7 percent this year and 3.3 percent in 2004. Germany was officially reprimanded for exceeding the Stability Pact last year with a budget deficit of 3.6 percent.