(RTTNews) - Shares of BMW AG were losing around 5 percent in German trading after the luxury car maker reported Wednesday a loss in its second quarter, compared to prior year's profit as demand was hit hard by coronavirus pandemic.
Looking ahead, the company said it is cautiously optimistic for second half of the year, and reaffirmed fiscal 2020 outlook. Group profit before tax for the year is expected to be significantly lower than in 2019.
Oliver Zipse, Chairman of the Board of Management of BMW, said, "We are now looking ahead to the second six-month period with cautious optimism and continue to target an EBIT margin between 0 and 3 percent for the Automotive segment in 2020."
Worldwide deliveries for the Automotive segment in 2020 are likely to be significantly lower than last year.
Motorcycles segment's EBIT margin is currently expected to range between 3 and 5 percent, and deliveries are expected to decrease significantly.
BMW Group continues to assume that demand in all key markets will be significantly reduced in light of the coronavirus pandemic and the necessary containment measures.
The company still intends to invest more than 30 billion euros in research and development up to 2025 with the aim of extending its leading edge in terms of innovation.
For the second quarter, BMW posted a loss after tax of 212 million euros, compared to last year's profit of 1.48 billion euros. The loss before tax totaled 300 million euros, compared to the profit before tax of 2.05 billion euros recorded in the prior year.
EBIT for the period was negative 666 million euros versus positive EBIT of 2.2 billion euros last year. The EBT margin fell to negative 1.5 percent from positive 8.0 percent a year earlier.
BMW's Group revenues for the second quarter declined 22.3 percent to 19.97 billion euros from 25.72 billion euros last year. Revenues in Automotive segment were down 34.2 percent, and revenues in Motorcycle segment declined by 28.2 percent.
In total, the company delivered 485,464 vehicles in the second quarter, down 25.3 percent from last year.
In Germany, BMW shares were trading at 55.38 euros, down 4.75 percent.
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