<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 UNDER
THE SECURITIES EXCHANGE ACT OF 1934
For the month of October, 2000
DAIMLERCHRYSLER AG
(Translation of registrant's name into English)
EPPLESTRASSE 225, 70567 STUTTGART, GERMANY
(Address of principal executive office)
[Indicate by check mark whether the registrant files or will
file annual reports under cover of Form 20-F or Form 40-F.]
Form 20-F /X/ Form 40-F / /
[Indicate by check mark whether the registrant by furnishing
the information contained in this Form is also thereby furnishing the
information to the Commission pursuant to Rule 12g3-2(b) under the
Securities Exchange Act of 1934.]
Yes / / No /X/
[If "Yes" is marked, indicate below the file number
assigned to the registrant in connection with Rule 12g3-2(b): 82-______]
-------------------------
This report on Form 6-K is hereby incorporated by reference in the registration
statement on Form F-3 of DaimlerChrysler North America Holding Corporation
(Registration Statement No. 333-11306)
<PAGE>
DAIMLERCHRYSLER AG
FORM 6-K: TABLE OF CONTENTS
1. Unaudited Interim Condensed Consolidated Financial Statements of
DaimlerChrysler AG as of September 30, 2000 and for the three and
nine month periods ended September 30, 2000 and 1999
2. Interim Report to Stockholders for the nine month period ended
September 30, 2000
<PAGE>
FORWARD-LOOKING INFORMATION
The Interim Report to Stockholders of DaimlerChrysler AG for the nine month
period ended September 30, 2000 included in this report contains forward-looking
statements based on beliefs of DaimlerChrysler management. When used in this
report, the words "anticipate," "believe," "estimate," "expect," "intend,"
"plan" and "project" are intended to identify forward-looking statements. Such
statements reflect the current views of DaimlerChrysler with respect to future
events and are subject to risks and uncertainties. Many factors could cause the
actual results to be materially different, including, among others, changes in
general economic and business conditions, changes in currency exchange rates and
interest rates, introduction of competing products, increased competitive
pressure on the general level of sales incentives, lack of acceptance of new
products or services, inability to meet efficiency and cost reduction
objectives, and changes in business strategy. Actual results may vary materially
from those projected here. DaimlerChrysler does not intend or assume any
obligation to update these forward-looking statements.
<PAGE>
1
<PAGE>
DAIMLERCHRYSLER AG
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(IN MILLIONS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
Three Months Ended September 30,
-------------------------------------
CONSOLIDATED
-------------------------------------
2000
(Note 1) 2000 1999
-------- -------- --------
<S> <C> <C> <C>
Revenues .......................... $ 32,839 [EURO]37,161 [EURO]36,232
Cost of sales ..................... (27,151) (30,724) (28,765)
-------- -------- --------
GROSS MARGIN ......................... 5,688 6,437 7,467
Selling, administrative and other
expenses ......................... (4,327) (4,897) (3,960)
Research and development .......... (1,331) (1,506) (1,426)
Other income ...................... 178 202 207
-------- -------- --------
INCOME BEFORE FINANCIAL INCOME ....... 208 236 2,288
Financial income, net ............. (32) (36) 46
-------- -------- --------
INCOME BEFORE INCOME TAXES ........... 176 200 2,334
Income taxes ...................... (48) (54) (905)
Minority interests ................ (22) (25) (4)
-------- -------- --------
INCOME BEFORE EXTRAORDINARY ITEM AND
CUMULATIVE EFFECT OF A CHANGE IN
ACCOUNTING PRINCIPLE ............... 106 121 1,425
Extraordinary item: Gains on
disposals of businesses, net of
taxes ............................. 2,644 2,992 535
Cumulative effect of a change in
accounting principle: transition
adjustment resulting from adoption
of EITF 99-20, net of taxes ....... (87) (99) --
-------- -------- --------
NET INCOME ........................... 2,663 3,014 1,960
======== ======== ========
EARNINGS PER SHARE
Basic earnings per share
Income before extraordinary item
and cumulative effect of a change
in accounting principle ......... 0.11 0.12 1.42
Extraordinary item ............... 2.64 2.99 0.53
Cumulative effect of a change in
accounting principle ............ (0.09) (0.10) --
-------- -------- --------
Net income ....................... 2.66 3.01 1.95
======== ======== ========
Diluted earnings per share
Income before extraordinary item
and cumulative effect of a change
in accounting principle ......... 0.11 0.12 1.41
Extraordinary item ............... 2.61 2.95 0.53
Cumulative effect of a change in
accounting principle ............ (0.09) (0.10) --
-------- -------- --------
Net income ....................... 2.63 2.97 1.94
======== ======== ========
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE UNAUDITED INTERIM
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS.
F-1
<PAGE>
DAIMLERCHRYSLER AG
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME - CONTINUED
(IN MILLIONS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
Three Months Ended September 30,
-----------------------------------------------------
INDUSTRIAL BUSINESS FINANCIAL SERVICES
----------------------- ----------------------
2000 1999 2000 1999
------- ------- ------- -------
<S> <C> <C> <C> <C>
Revenues ......................... [EURO]33,164 [EURO]33,644 [EURO]3,997 [EURO]2,588
Cost of sales .................... (26,603) (26,620) (4,121) (2,145)
------- ------- ------- -------
GROSS MARGIN ........................ 6,561 7,024 (124) 443
Selling, administrative and other
expenses ........................ (4,546) (3,725) (351) (235)
Research and development ......... (1,506) (1,426) -- --
Other income ..................... 161 175 41 32
------- ------- ------- -------
INCOME (LOSS) BEFORE FINANCIAL INCOME 670 2,048 (434) 240
Financial income, net ............ (39) 44 3 2
------- ------- ------- -------
INCOME (LOSS) BEFORE INCOME TAXES ... 631 2,092 (431) 242
Income taxes ..................... (249) (844) 195 (61)
Minority interests ............... (24) (4) (1) --
------- ------- ------- -------
INCOME (LOSS) BEFORE EXTRAORDINARY
ITEM AND CUMULATIVE EFFECT OF A
CHANGE IN ACCOUNTING PRINCIPLE .... 358 1,244 (237) 181
Extraordinary item: Gains on
disposals of businesses, net of
taxes ............................ 2,992 535 -- --
Cumulative effect of a change in
accounting principle: transition
adjustment resulting from adoption
of EITF 99-20, net of taxes ...... -- -- (99) --
------- ------- ------- -------
NET INCOME (LOSS) ................... 3,350 1,779 (336) 181
======= ======= ======= =======
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE UNAUDITED INTERIM
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS.
F-2
<PAGE>
DAIMLERCHRYSLER AG
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(IN MILLIONS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
Nine Months Ended September 30,
---------------------------------------
CONSOLIDATED
---------------------------------------
2000
(Note 1) 2000 1999
----------- ----------- -----------
<S> <C> <C> <C>
Revenues .......................... $ 107,689 [EURO]121,862 [EURO]108,548
Cost of sales ..................... (86,695) (98,105) (85,035)
--------- --------- ---------
GROSS MARGIN ......................... 20,994 23,757 23,513
Selling, administrative and other
expenses ......................... (12,892) (14,589) (12,891)
Research and development .......... (3,999) (4,525) (4,177)
Other income ...................... 758 858 684
--------- --------- ---------
INCOME BEFORE FINANCIAL INCOME ....... 4,861 5,501 7,129
Financial income, net ............. 265 300 135
--------- --------- ---------
INCOME BEFORE INCOME TAXES ........... 5,126 5,801 7,264
Effects of changes in German
tax law ..................... -- -- (597)
Income taxes .................. (1,958) (2,216) (2,697)
--------- --------- ---------
Total income taxes ................ (1,958) (2,216) (3,294)
Minority interests ................ (20) (23) (19)
--------- --------- ---------
INCOME BEFORE EXTRAORDINARY ITEM AND
CUMULATIVE EFFECTS OF CHANGES IN
ACCOUNTING PRINCIPLES .............. 3,148 3,562 3,951
Extraordinary item: Gains on
disposals of businesses, net of
taxes ............................. 2,644 2,992 659
Cumulative effects of changes in
accounting principles: transition
adjustments resulting from adoption
of SFAS 133 and EITF 99-20, net of
taxes ............................. (77) (87) --
--------- --------- ---------
NET INCOME ........................... 5,715 6,467 4,610
========= ========= =========
EARNINGS PER SHARE
Basic earnings per share
Income before extraordinary item
and cumulative effects of changes
in accounting principles ........ 3.14 3.55 3.94
Extraordinary item ............... 2.64 2.99 0.66
Cumulative effects of changes in
accounting principles ........... (0.08) (0.09) --
--------- --------- ---------
Net income ....................... 5.70 6.45 4.60
========= ========= =========
Diluted earnings per share
Income before extraordinary item
and cumulative effects of changes
in accounting principles ........ 3.12 3.53 3.91
Extraordinary item ............... 2.61 2.95 0.65
Cumulative effects of changes in
accounting principles ........... (0.08) (0.09) --
--------- --------- ---------
Net income ....................... 5.65 6.39 4.56
========= ========= =========
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE UNAUDITED INTERIM
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS.
F-3
<PAGE>
DAIMLERCHRYSLER AG
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME - CONTINUED
(IN MILLIONS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
Nine Months Ended September 30,
------------------------------------------------------
INDUSTRIAL BUSINESS FINANCIAL SERVICES
------------------------- ----------------------
2000 1999 2000 1999
--------- --------- -------- ---------
<S> <C> <C> <C> <C>
Revenues .......................... [EURO]110,898 [EURO]101,401 [EURO]10,964 [EURO]7,147
Cost of sales ..................... (87,882) (79,137) (10,223) (5,898)
--------- --------- -------- ---------
GROSS MARGIN ......................... 23,016 22,264 741 1,249
Selling, administrative and other
expenses ........................ (13,653) (12,179) (936) (712)
Research and development .......... (4,525) (4,177) -- --
Other income ...................... 772 582 86 102
--------- --------- -------- ---------
INCOME (LOSS) BEFORE FINANCIAL INCOME 5,610 6,490 (109) 639
Financial income, net ............. 293 130 7 5
--------- --------- -------- ---------
INCOME (LOSS) BEFORE INCOME TAXES .... 5,903 6,620 (102) 644
Effects of changes in German
tax law ..................... -- (634) -- 37
Income taxes .................. (2,327) (2,515) 111 (182)
--------- --------- -------- ---------
Total income taxes ................ (2,327) (3,149) 111 (145)
Minority interests ................ (22) (17) (1) (2)
--------- --------- -------- ---------
INCOME BEFORE EXTRAORDINARY ITEM AND
CUMULATIVE EFFECTS OF CHANGES IN
ACCOUNTING PRINCIPLES .............. 3,554 3,454 8 497
Extraordinary item: Gains on
disposals of businesses, net of
taxes ............................. 2,992 659 -- --
Cumulative effects of changes in
accounting principles: transition
adjustments resulting from adoption
of SFAS 133 and EITF 99-20, net of
taxes ............................. 10 -- (97) --
--------- --------- -------- ---------
NET INCOME (LOSS) .................... 6,556 4,113 (89) 497
========= ========= ======== =========
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE UNAUDITED INTERIM
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS.
F-4
<PAGE>
DAIMLERCHRYSLER AG
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN MILLIONS)
<TABLE>
<CAPTION>
CONSOLIDATED
---------------------------------------
At September 30,
---------------------- At
2000 December 31,
(Note 1) 2000 1999
---------- ----------- --------------
(unaudited)
<S> <C> <C> <C>
ASSETS
Intangible assets ............... $ 3,104 [EURO]3,513 [EURO]2,823
Property, plant and equipment,
net ........................... 36,613 41,432 36,434
Investments and long-term
financial assets .............. 7,530 8,521 3,942
Equipment on operating leases,
net ........................... 31,410 35,543 27,249
-------- -------- --------
FIXED ASSETS ...................... 78,657 89,009 70,448
-------- -------- --------
Inventories ..................... 15,357 17,378 14,985
Trade receivables ............... 7,863 8,898 8,840
Receivables from financial
services ...................... 48,526 54,912 38,735
Other receivables ............... 12,753 14,432 12,571
Securities ...................... 8,990 10,173 8,969
Cash and cash equivalents ....... 4,059 4,593 9,099
-------- -------- --------
NON-FIXED ASSETS .................. 97,548 110,386 93,199
-------- -------- --------
DEFERRED TAXES .................... 2,700 3,055 3,806
-------- -------- --------
PREPAID EXPENSES .................. 7,075 8,006 7,214
-------- -------- --------
TOTAL ASSETS ...................... 185,980 210,456 174,667
======== ======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Capital stock ................... $ 2,306 [EURO]2,609 [EURO]2,565
Additional paid-in capital ...... 6,438 7,285 7,329
Retained earnings ............... 24,773 28,034 23,925
Accumulated other comprehensive
income ........................ 4,070 4,606 2,241
Treasury stock .................. -- -- --
-------- -------- --------
STOCKHOLDERS' EQUITY .............. 37,587 42,534 36,060
-------- -------- --------
MINORITY INTERESTS ................ 471 533 650
-------- -------- --------
ACCRUED LIABILITIES ............... 32,092 36,315 37,695
-------- -------- --------
Financial liabilities ........... 78,139 88,422 64,488
Trade liabilities ............... 15,657 17,718 15,786
Other liabilities ............... 11,625 13,155 10,286
-------- -------- --------
LIABILITIES ....................... 105,421 119,295 90,560
-------- -------- --------
DEFERRED TAXES .................... 5,261 5,953 5,192
-------- -------- --------
DEFERRED INCOME ................... 5,148 5,826 4,510
-------- -------- --------
TOTAL LIABILITIES ................. 148,393 167,922 138,607
-------- -------- --------
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY .......................... 185,980 210,456 174,667
======== ======== ========
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE UNAUDITED INTERIM
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS.
F-5
<PAGE>
DAIMLERCHRYSLER AG
CONDENSED CONSOLIDATED BALANCE SHEETS - CONTINUED
(IN MILLIONS)
<TABLE>
<CAPTION>
INDUSTRIAL BUSINESS FINANCIAL SERVICES
---------------------------- ----------------------------------
At At At At
September 30, December 31, September 30, December 31,
2000 1999 2000 1999
------------- ------------- ------------- ------------------
(unaudited) (unaudited)
<S> <C> <C> <C> <C>
ASSETS
Intangible assets ........................ [EURO]3,300 [EURO]2,632 [EURO]213 [EURO]191
Property, plant and equipment, net ....... 41,334 36,338 98 96
Investments and long-term financial assets 7,413 3,079 1,108 863
Equipment on operating leases, net ....... 5,324 3,433 30,219 23,816
------- ------- ------- -------
FIXED ASSETS ............................... 57,371 45,482 31,638 24,966
------- ------- ------- -------
Inventories .............................. 16,543 14,036 835 949
Trade receivables ........................ 8,391 8,522 507 318
Receivables from financial services ...... 43 38 54,869 38,697
Other receivables ........................ 6,515 5,408 7,917 7,163
Securities ............................... 8,736 8,250 1,437 719
Cash and cash equivalents ................ 3,667 8,197 926 902
------- ------- ------- -------
NON-FIXED ASSETS ........................... 43,895 44,451 66,491 48,748
------- ------- ------- -------
DEFERRED TAXES ............................. 2,941 3,710 114 96
------- ------- ------- -------
PREPAID EXPENSES ........................... 7,872 7,076 134 138
------- ------- ------- -------
TOTAL ASSETS ............................... 112,079 100,719 98,377 73,948
======= ======= ======= =======
LIABILITIES AND STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY ....................... [EURO]35,864 [EURO]30,318 [EURO]6,670 [EURO]5,742
------- ------- ------- -------
MINORITY INTERESTS ......................... 518 637 15 13
------- ------- ------- -------
ACCRUED LIABILITIES ........................ 35,552 37,155 763 540
------- ------- ------- -------
Financial liabilities .................... 6,428 4,400 81,994 60,088
Trade liabilities ........................ 17,412 15,484 306 302
Other liabilities ........................ 10,056 7,655 3,099 2,631
------- ------- ------- -------
LIABILITIES ................................ 33,896 27,539 85,399 63,021
------- ------- ------- -------
DEFERRED TAXES ............................. 747 1,227 5,206 3,965
------- ------- ------- -------
DEFERRED INCOME ............................ 5,502 3,843 324 667
------- ------- ------- -------
TOTAL LIABILITIES .......................... 76,215 70,401 91,707 68,206
------- ------- ------- -------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY . 112,079 100,719 98,377 73,948
======= ======= ======= =======
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE UNAUDITED INTERIM
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS.
F-6
<PAGE>
DAIMLERCHRYSLER AG
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN MILLIONS)
<TABLE>
<CAPTION>
Nine Months Ended September 30,
---------------------------------------------
CONSOLIDATED
---------------------------------------------
2000
(Note 1) 2000 1999
--------- ----------- -----------
<S> <C> <C> <C>
Net income ......................................................... $ 5,715 [EURO]6,467 [EURO]4,610
Income applicable to minority interests ............................ 20 23 19
Adjustments to reconcile net income to net cash provided by
operating activities:
Gains on disposals of businesses (see also Note 5) ............ (2,633) (2,980) (1,170)
Depreciation and amortization of equipment on operating leases 4,151 4,697 2,382
Depreciation and amortization of fixed assets ................. 4,666 5,280 4,194
Change in deferred taxes ...................................... 1,426 1,613 2,407
Change in financial instruments ............................... (482) (545) 169
(Gains) losses on disposals of fixed assets/securities ........ (353) (400) (210)
Change in trading securities .................................. 44 50 402
Change in accrued liabilities ................................. (391) (443) 2,526
Changes in other operating assets and liabilities:
- inventories, net .......................................... (1,638) (1,854) (2,479)
- trade receivables ......................................... (779) (881) (1,164)
- trade liabilities ......................................... 1,167 1,321 805
- other assets and liabilities .............................. 1,613 1,827 808
-------- -------- --------
CASH PROVIDED BY OPERATING ACTIVITIES .............................. 12,526 14,175 13,299
-------- -------- --------
Purchases of fixed assets:
- Increase in equipment on operating leases ....................... (13,125) (14,852) (13,963)
- Purchases of property, plant and equipment ...................... (6,744) (7,632) (6,005)
- Purchases of other fixed assets ................................. (303) (343) (396)
Proceeds from disposals of equipment on operating leases ........... 5,789 6,551 4,779
Proceeds from disposals of fixed assets ............................ 284 321 335
Payments for acquisitions of businesses ............................ (1,604) (1,815) (876)
Proceeds from disposals of businesses .............................. 87 98 1,294
Change in cash from exchange of business ........................... (2,018) (2,283) --
(Increase) decrease in receivables from financial services, net .... (10,557) (11,946) (4,715)
Acquisitions of securities (other than trading), net ............... (1,674) (1,894) (913)
Change in other cash ............................................... 706 798 (503)
-------- -------- --------
CASH USED FOR INVESTING ACTIVITIES ................................. (29,159) (32,997) (20,963)
-------- -------- --------
Change in financial liabilities (including amounts for commercial
paper borrowings of [EURO]2,394 ($2,116) and [EURO]3,319 in
2000 and 1999, respectively) .................................. 14,506 16,415 10,305
Dividends paid (including profit transferred from subsidiaries) .... (2,096) (2,372) (2,378)
Proceeds from issuance of capital stock (including
minority interests) ........................................... 76 86 75
Purchase of treasury stock ......................................... (67) (76) (29)
-------- -------- --------
CASH PROVIDED BY (USED FOR) FINANCING ACTIVITIES ................... 12,419 14,053 7,973
-------- -------- --------
Effect of foreign exchange rate changes on cash and cash
equivalents (maturing within 3 months) ........................ 524 593 425
-------- -------- --------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
(MATURING WITHIN 3 MONTHS) .................................... (3,690) (4,176) 734
-------- -------- --------
CASH AND CASH EQUIVALENTS (MATURING WITHIN 3 MONTHS)
AT BEGINNING OF PERIOD ........................................ 7,742 8,761 6,281
-------- -------- --------
AT END OF PERIOD .............................................. 4,052 4,585 7,015
======== ======== ========
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE UNAUDITED INTERIM
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS.
F-7
<PAGE>
DAIMLERCHRYSLER AG
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - CONTINUED
(IN MILLIONS)
<TABLE>
<CAPTION>
Nine Months Ended September 30,
-------------------------------------------------------
INDUSTRIAL BUSINESS FINANCIAL SERVICES
----------------------- -----------------------
2000 1999 2000 1999
-------- ------- ------- -------
<S> <C> <C> <C> <C>
Net income (loss).............................................. [EURO]6,556 [EURO]4,113 [EURO](89) [EURO]497
Income applicable to minority interests ....................... 22 17 1 2
Adjustments to reconcile net income to net cash provided by
operating activities:
Gains on disposals of businesses (see also Note 5) ....... (2,980) (1,170) -- --
Depreciation and amortization of equipment on operating
leases ................................................. 328 216 4,369 2,166
Depreciation and amortization of fixed assets ............ 5,229 4,149 51 45
Change in deferred taxes ................................. 954 1,945 659 462
Change in financial instruments .......................... (541) 170 (4) (1)
(Gains) losses on disposals of fixed assets/securities ... (399) (257) (1) 47
Change in trading securities ............................. 50 427 -- (25)
Change in accrued liabilities ............................ (399) 2,466 (44) 60
Changes in other operating assets and liabilities:
- inventories, net ..................................... (1,751) (2,424) (103) (55)
- trade receivables .................................... (897) (2,056) 16 892
- trade liabilities .................................... 1,331 774 (10) 31
- other assets and liabilities ......................... 1,779 450 48 358
------- ------- ------- -------
CASH PROVIDED BY OPERATING ACTIVITIES ......................... 9,282 8,820 4,893 4,479
------- ------- ------- -------
Purchases of fixed assets:
- Increase in equipment on operating leases .................. (3,790) (2,957) (11,062) (11,006)
- Purchases of property, plant and equipment ................. (7,604) (5,960) (28) (45)
- Purchases of other fixed assets ............................ (310) (326) (33) (70)
Proceeds from disposals of equipment on operating leases ...... 3,219 2,800 3,332 1,979
Proceeds from disposals of fixed assets ....................... 300 304 21 31
Payments for acquisitions of businesses ....................... (1,716) (761) (99) (115)
Proceeds from disposals of businesses ......................... 85 1,294 13 --
Change in cash from exchange of business ...................... (2,283) -- -- --
(Increase) decrease in receivables from financial services, net (204) 70 (11,742) (4,785)
Acquisitions of securities (other than trading), net .......... (1,304) (851) (590) (62)
Change in other cash .......................................... 557 (524) 241 21
------- ------- ------- -------
CASH USED FOR INVESTING ACTIVITIES ............................ (13,050) (6,911) (19,947) (14,052)
------- ------- ------- -------
Change in financial liabilities ............................... 1,588 809 14,827 9,496
Dividends paid (including profit transferred from subsidiaries) (2,371) (2,378) (1) --
Proceeds from issuance of capital stock (including
minority interests) ...................................... (96) 32 182 43
Purchase of treasury stock .................................... (76) (29) -- --
------- ------- ------- -------
CASH PROVIDED BY (USED FOR) FINANCING ACTIVITIES .............. (955) (1,566) 15,008 9,539
------- ------- ------- -------
Effect of foreign exchange rate changes on cash and cash
equivalents (maturing within 3 months) ................... 523 402 70 23
------- ------- ------- -------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
(MATURING WITHIN 3 MONTHS) ............................... (4,200) 745 24 (11)
------- ------- ------- -------
CASH AND CASH EQUIVALENTS (MATURING WITHIN 3 MONTHS)
AT BEGINNING OF PERIOD ................................... 7,859 5,660 902 621
------- ------- ------- -------
AT END OF PERIOD ......................................... 3,659 6,405 926 610
======= ======= ======= =======
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE UNAUDITED INTERIM
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS.
F-8
<PAGE>
DAIMLERCHRYSLER AG
NOTES TO UNAUDITED INTERIM CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS
(IN MILLIONS)
1. PRESENTATION OF CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
The condensed consolidated financial statements of DaimlerChrysler AG and
subsidiaries ("DaimlerChrysler" or the "Group") have been prepared in accordance
with United States Generally Accepted Accounting Principles ("U.S. GAAP"). All
amounts herein are shown in millions of euros ("[EURO]") and as of and for the
three and nine months ended September 30, 2000, are also presented in U.S.
dollars ("$"), the latter being presented solely for the convenience of the
reader at the rate of [EURO]1= $0.8837, the Noon Buying Rate of the Federal
Reserve Bank of New York on September 29, 2000.
The information included in the condensed consolidated financial statements
is unaudited but reflects all adjustments (consisting only of normal recurring
adjustments) which are, in the opinion of management, necessary for a fair
statement of the results for the interim periods presented. The condensed
consolidated financial statements should be read in conjunction with the
December 31, 1999 consolidated financial statements and notes included in the
Group's 1999 Annual Report on Form 20-F. Certain prior year balances have been
reclassified to conform with the Group's current year presentation.
To enhance the readers' understanding of the Group's consolidated financial
statements, the accompanying financial statements present, in addition to the
consolidated financial statements, information with respect to the financial
position, results of operations and cash flows of the Group's industrial and
financial services business activities. Such information, however, is not
required by U.S. GAAP and is not intended to, and does not represent the
separate U.S. GAAP financial position, results of operations or cash flows of
the Group's industrial or financial services business activities. Transactions
between the Group's industrial and financial businesses principally represent
intercompany sales of products, intercompany borrowings and related interest,
and other support under special vehicle financing programs. The effects of
transactions between the industrial and financial services businesses have been
eliminated within the industrial business columns.
In September 2000, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standards ("SFAS") No. 140, ACCOUNTING FOR TRANSFERS AND
SERVICING OF FINANCING ASSETS AND EXTINGUISHMENTS OF LIABILITIES - A REPLACEMENT
OF FASB STATEMENT NO. 125. This statement revises the standards for accounting
for securitizations and other transfers of financial assets and collateral and
requires certain financial statement disclosures. This statement is effective
for transactions occuring after March 31, 2001. The new disclosure requirements
are effective for fiscal years ending after December 15, 2000. Adoption of this
replacement standard is not anticipated to have a material effect on
DaimlerChrysler's consolidated financial statements.
2. ACQUISITIONS AND DISPOSITIONS
Information on the exchange of shares of DaimlerChrysler Aerospace for shares
of European Aeronautic Defense and Space Company ("EADS") and the initial public
offering of EADS and on the sale of a substantial portion of DaimlerChrysler's
interests in debitel AG is included in Note 5.
In September 2000, DaimlerChrysler acquired 100% of the outstanding shares of
the Canadian company Western Star Trucks Holdings Ltd. for approximately
[EURO]500. The acquisition has been accounted for under the purchase method of
accounting. The purchase price has been allocated to assets acquired and
liabilities assumed based on their estimated fair values at the date of
acquisition, pending final determination of the acquired balances. This
allocation resulted in preliminary goodwill of approximately [EURO]300, which
will be amortized on a straight-line basis over 20 years.
In June 2000, DaimlerChrysler and Hyundai Motor Company signed a Letter of
Intent and a Stock Purchase Agreement to form an alliance, primarily consisting
of a joint venture for the development, production and marketing
F-9
<PAGE>
DAIMLERCHRYSLER AG
NOTES TO UNAUDITED INTERIM CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS
(IN MILLIONS)
of commercial vehicles as well as for the development and production of
passenger cars. In September 2000, DaimlerChrysler purchased an approximate 10%
equity interest in Hyundai Motor Company for approximately [EURO]450.
In the first quarter of 1999, DaimlerChrysler acquired the remaining
outstanding shares of Adtranz, a rail systems joint venture, from Asea Brown
Boveri for $472 ([EURO]441). The acquisition has been accounted for under the
purchase method of accounting. The purchase price has been allocated to assets
acquired and liabilities assumed based on their estimated fair values. This
allocation resulted in goodwill of [EURO]100, which is being amortized on a
straight-line basis over 17 years. Information related to the sale of the
Group's interests in Adtranz is included in Note 15.
3. IMPAIRMENT CHARGE
During the three months ended September 30, 2000, DaimlerChrysler recorded an
impairment charge in cost of sales of approximately [EURO]500 for certain leased
vehicles in the Services segment. Declining resale prices of used vehicles in
the North American and the U.K. markets required the Group to re-evaluate the
recoverability of the carrying values of its leased vehicles. This
re-evaluation was performed using product specific cash flow information.
As a result, the carrying values of these leased vehicles were determined to
be impaired as the identifiable undiscounted future cash flows from such
vehicles were less than their respective carrying values. In accordance with
SFAS No. 121, the resulting pre-tax impairment charges represent the amount
by which the carrying values of such vehicles exceeded their respective fair
market values.
4. INCOME TAXES
Effective January 1, 1999, the tax laws in Germany were changed, including a
reduction in the retained corporate income tax rate from 45% to 40%. The effects
of the changes in the German tax law on the December 31, 1998 deferred tax
assets and liabilities were recognized in the amount of [EURO]597 (basic:
[EURO]0.60 per share; diluted: [EURO]0.59 per share) as a charge in the
consolidated statement of income for the first quarter of 1999.
5. EXTRAORDINARY ITEM
In October 1999, DaimlerChrysler, the French Lagardere Group and the French
government agreed to merge their respective aerospace and defense activities
into a new company. In December 1999, Sociedad Estatal de Participaciones
Industriales ("SEPI") agreed to join the Franco-German alliance. The new
corporation, called European Aeronautic Defense and Space Company, was
established through a merger of Aerospatiale Matra S.A., DaimlerChrysler
Aerospace AG and Construcciones Aeronauticas S.A. ("CASA"). The exchange of
shares of DaimlerChrysler Aerospace for shares of EADS and the initial public
offering of EADS were completed in July 2000. DaimlerChrysler has accounted for
the shares of EADS received in the exchange at their fair value on that date and
recorded an extraordinary gain of [EURO]2,992. DaimlerChrysler accounts for its
33% interest in EADS using the equity method of accounting.
In March 1999, debis AG, a wholly-owned subsidiary of DaimlerChrysler
included in the Services segment, sold a portion of its interests in debitel AG
in an initial public offering of its ordinary shares for proceeds of [EURO]274.
In September 1999, debis AG sold a substantial portion of its remaining
interests in debitel AG to Swisscom for proceeds of [EURO]924. The sales
resulted in an extraordinary after-tax gain of [EURO]659 (net of income tax
expense of [EURO]483) and reduced debis' remaining equity interest in debitel to
approximately 10%.
F-10
<PAGE>
DAIMLERCHRYSLER AG
NOTES TO UNAUDITED INTERIM CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS
(IN MILLIONS)
6. CUMULATIVE EFFECTS OF CHANGES IN ACCOUNTING PRINCIPLES
RECOGNITION OF INTEREST INCOME AND IMPAIRMENT ON PURCHASED AND RETAINED
BENEFICIAL INTERESTS IN SECURITIZED FINANCIAL ASSETS (EITF 99-20)
As of July 1, 2000, DaimlerChrysler adopted Emerging Issues Task Force Issue
No. 99-20 ("EITF 99-20"), RECOGNITION OF INTEREST INCOME AND IMPAIRMENT ON
PURCHASED AND RETAINED BENEFICIAL INTERESTS IN SECURITIZED FINANCIAL ASSETS.
EITF 99-20 specifies how a transferor that retains an interest in a
securitization transaction, or an enterprise that purchases a beneficial
interest, should account for interest income and impairment. The cumulative
effect of adopting EITF 99-20 was an after-tax charge of [EURO]99 (net of income
tax benefits of [EURO]58).
DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES
ADOPTION OF SFAS 133
DaimlerChrysler elected to adopt SFAS No. 133, ACCOUNTING FOR DERIVATIVE
INSTRUMENTS AND HEDGING ACTIVITIES, on January 1, 2000. Upon adoption of this
Statement, DaimlerChrysler recorded a net transition adjustment gain of [EURO]12
(net of income tax expense of [EURO]5) in net income and a net transition
adjustment loss of [EURO]349 (net of income tax benefit of [EURO]367) in
accumulated other comprehensive income. During the three- and nine-month periods
ended September 30, 2000, DaimlerChrysler reclassified [EURO]82 and [EURO]241,
respectively, of net losses (net of income tax benefit of [EURO]67 and
[EURO]224, respectively) from accumulated other comprehensive income into net
income relating to the transition adjustment included in accumulated other
comprehensive income on January 1, 2000.
FOREIGN CURRENCY RISK MANAGEMENT
As a consequence of the global nature of DaimlerChrysler's businesses, its
operations and its reported financial results and cash flows are exposed to the
risks associated with fluctuations in the exchange rates between the euro, the
U.S. dollar and other major world currencies. DaimlerChrysler's businesses are
exposed to transaction risk whenever revenues are denominated in a currency
other than the currency in which the costs relating to those revenues are
incurred. This risk exposure primarily affects the Mercedes-Benz Passenger Cars
division and the Aerospace segment. In the Mercedes-Benz Passenger Cars
division, revenues are denominated in the currencies of the countries in which
cars are sold, but manufacturing costs are denominated primarily in euros.
Similarly, Aerospace revenues resulting from the sale of aircraft and other
aerospace related products are principally denominated in U.S. dollars due to
the requirements of the marketplace, but the products are manufactured almost
exclusively in Germany. An additional risk element associated with the
operations of the Aerospace segment is that the sale contracts for its products,
especially aircraft, are generally made well in advance of the production and
delivery of the products.
In order to mitigate the impact of currency exchange rate fluctuations,
DaimlerChrysler continually assesses its exposure to currency risks and hedges a
portion of those risks through the use of derivative financial instruments,
principally forward exchange contracts. The Group does not enter into these
types of derivative financial instruments for purposes other than hedging.
Responsibility for managing DaimlerChrysler's currency exposures and use of
currency derivatives is centralized within the Group's Currency Committee. The
Currency Committee, which consists of two separate sub-groups, one for the
Group's vehicle business and one for Aerospace, is comprised of members of
senior management from each of the respective businesses as well as from the
Corporate Treasury Department of DaimlerChrysler. Decisions concerning foreign
currency hedging taken by the Currency Committee are implemented by Corporate
Treasury. DaimlerChrysler's Board of Management is regularly informed of the
decisions of the Currency Committee as well as the actions of Corporate
Treasury.
F-11
<PAGE>
DAIMLERCHRYSLER AG
NOTES TO UNAUDITED INTERIM CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS
(IN MILLIONS)
With the initial public offering of EADS on July 10, 2000 (see also Note 5),
DaimlerChrysler Aerospace and its subsidiaries have ceased to participate in
DaimlerChrysler's centralized financial management. Treasury functions for these
entities will be carried out by EADS.
INTEREST RATE AND EQUITY PRICE RISK MANAGEMENT
DaimlerChrysler holds a variety of interest rate sensitive assets and
liabilities to manage the liquidity and cash needs of its day-to-day operations.
A substantial volume of interest rate sensitive assets and liabilities are
related to the lease and sales financing business. In particular, the Group's
lease and sales financing business principally enters into transactions with
customers resulting in fixed-rate long-term receivables. In order to finance
these receivables, the Group issues variable-rate long-term debt, medium-term
notes and commercial paper. These interest rate sensitive financial liabilities
expose DaimlerChrysler to variability in interest payments due to changes in
interest rates. Management believes it is prudent to limit the variability of a
portion of its interest payments. DaimlerChrysler uses derivative financial
instruments including swaps, swaptions, forward rate agreements, futures, caps
and floors to manage the risks arising from changes in interest rates. The Group
does not enter into these types of derivative financial instruments for purposes
other than hedging.
The Group assesses interest rate risk by continually identifying and
monitoring changes in interest rate exposures that may adversely impact expected
future cash flows and by evaluating hedging opportunities. The Group maintains
risk management control systems independent of Corporate Treasury to monitor
interest rate risk attributable to both DaimlerChrysler's outstanding or
forecasted debt obligations as well as its offsetting hedge positions. The risk
management control systems involve the use of analytical techniques, including
value-at-risk analyses, to estimate the expected impact of changes in interest
rates on the Group's future cash flows.
The Group also holds investments in various equity and debt securities to
improve the return on its liquidity. These securities subject DaimlerChrysler to
risks due to changes in quoted market prices. Management believes it is prudent
to limit the variability of a portion of the potential changes in market prices.
To a much lesser extent than the risks from changing interest rates,
DaimlerChrysler uses derivative financial instruments including futures and
options to manage the risks arising from changes in equity prices.
The Group assesses equity and debt securities price risk by continually
monitoring changes in key economic, industry and market information and
maintains risk management control systems independent of Corporate Treasury to
monitor risks attributable to both DaimlerChrysler's investments as well as its
offsetting hedge positions. The risk management control systems involve the use
of analytical techniques, including value-at-risk analyses, to estimate the
potential loss and manage the risks of the Group's investments.
INFORMATION WITH RESPECT TO FAIR VALUE HEDGES
Gains and losses in fair value of recognized assets and liabilities and firm
commitments of operating transactions as well as gains and losses on derivative
financial instruments designated as fair value hedges of these recognized assets
and liabilities and firm commitments are recognized currently in revenues, as
the principal transactions being hedged involve sales of the Group's products.
Net gains and losses in fair value of both recognized financial assets and
liabilities and derivative financial instruments designated as fair value hedges
of these financial assets and liabilities are recognized currently in financial
income, net.
INFORMATION WITH RESPECT TO CASH FLOW HEDGES
Changes in the value of foreign currency forward contracts designated and
qualifying as cash flow hedges of forecasted transactions are reported in
accumulated other comprehensive income. These amounts are subsequently
reclassified into earnings, as a component of the value of the forecasted
transaction, in the same period as the forecasted transaction affects earnings.
Changes in the fair value of interest rate swaps designated as hedging
F-12
<PAGE>
DAIMLERCHRYSLER AG
NOTES TO UNAUDITED INTERIM CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS
(IN MILLIONS)
instruments of variability of cash flows associated with variable-rate long-term
debt or financing receivables are also reported in accumulated other
comprehensive income. These amounts are subsequently reclassified into interest
expense or financial income, respectively, as a yield adjustment in the same
period in which the related interest on the floating-rate debt obligations or
financing receivables affect earnings.
As of September 30, 2000, DaimlerChrysler had purchased derivative financial
instruments with a maximum maturity of 39 months to hedge its exposure to the
variability in future cash flows associated with foreign currency forecasted
transactions.
ADOPTION OF SFAS NO. 138
On June 15, 2000, the Financial Accounting Standards Board issued SFAS No.
138, ACCOUNTING FOR CERTAIN DERIVATIVE INSTRUMENTS AND CERTAIN HEDGING
ACTIVITIES - AN AMENDMENT OF FASB STATEMENT NO. 133. The new Standard amends
SFAS No. 133 principally by:
1. Expanding the normal purchases and normal sales exception,
2. Permitting an entity to hedge to a designated benchmark interest rate
defined as either (a) the interest rate on direct Treasury obligations of
the U.S. government (Treasury rate), or (b) the London Interbank Offered
Rate (LIBOR) swap rate,
3. Permitting entities to hedge recognized foreign-currency-denominated
assets and liabilities for which a foreign currency transaction gain or
loss is recognized in earnings, and
4. Permitting certain internal derivatives to qualify for hedge accounting in
the consolidated financial statements even though these internal
derivatives are offset on a net or aggregate basis, rather than
individually, by third party derivative contracts.
DaimlerChrysler adopted SFAS No. 138 on July 1, 2000. Adoption of this
accounting standard did not have a material impact on the Group's consolidated
financial statements.
7. INVENTORIES
Inventories are comprised of the following:
<TABLE>
<CAPTION>
At September 30, At December 31,
2000 1999
---------------- ---------------
<S> <C> <C>
Raw materials and manufacturing supplies ........... [EURO]2,801 [EURO]2,602
Work-in-process .................................... 6,009 6,285
Finished goods, parts and products held for
resale ........................................... 10,964 9,887
Advance payments to suppliers ...................... 280 518
------- -------
20,054 19,292
Less: Advance payments received .................... (2,676) (4,307)
------- -------
17,378 14,985
======= =======
</TABLE>
8. CASH AND CASH EQUIVALENTS
As of September 30, 2000 and December 31, 1999 cash and cash equivalents
include [EURO]8 and [EURO]338, respectively, of deposits with original
maturities of more than three months.
F-13
<PAGE>
DAIMLERCHRYSLER AG
NOTES TO UNAUDITED INTERIM CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS
(IN MILLIONS)
9. STOCKHOLDERS' EQUITY
The changes in stockholders' equity for the nine months ended September 30,
2000 follow (in [EURO]):
<TABLE>
<CAPTION>
Accumulated other
comprehensive income
------------------------------------------------
Additional Cumulative Available- Minimum
Capital paid-in Retained translation for-sale Derivative pension Treasury
stock capital earnings adjustment securities instruments liability Stock Total
-------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
BALANCE AT JANUARY 1, 2000 ..... 2,565 7,329 23,925 1,922 347 -- (28) -- 36,060
Comprehensive income:
Net income .................. -- -- 6,467 -- -- -- -- -- 6,467
Other comprehensive income .. -- -- -- 3,133 45 (819) 6 -- 2,365
-------
Total comprehensive income .. 8,832
Increase in stated value of
capital stock ............... 44 (44) -- -- -- -- -- -- --
Purchase of capital stock ...... -- -- -- -- -- -- -- (76) (76)
Re-issuance of treasury stock .. -- -- -- -- -- -- -- 76 76
Dividends ...................... -- -- (2,358) -- -- -- -- -- (2,358)
-------------------------------------------------------------------------------------------------
BALANCE AT SEPTEMBER 30, 2000 .. 2,609 7,285 28,034 5,055 392 (819) (22) -- 42,534
=================================================================================================
</TABLE>
Upon adoption of SFAS 133, a net transition adjustment loss of [EURO]349 (net
of income tax benefit of [EURO]367) was recorded in accumulated other
comprehensive income. During the three- and nine-month periods ended September
30, 2000, DaimlerChrysler reclassified [EURO]82 and [EURO]241, respectively, of
net losses (net of income tax benefit of [EURO]67 and [EURO]224, respectively)
from accumulated other comprehensive income into net income relating to the
transition adjustment included in accumulated other comprehensive income on
January 1, 2000. For the three- and nine-month periods ended September 30, 2000,
net losses on derivatives hedging variability of cash flows, excluding amounts
related to the transition adjustment, amounted to [EURO]596 and [EURO]879,
respectively, (net of income tax benefit of [EURO]624 and [EURO]925,
respectively). Reclassification adjustments for losses reclassified into income,
excluding amounts related to the transition adjustment, amounted to [EURO]76 and
[EURO]168, respectively, (net of income tax benefit of [EURO]74 and [EURO]181,
respectively) for the three- and nine-month periods ended September 30, 2000.
Total comprehensive income of the Group for the three months ended September
30, 2000 and the three- and the nine-month periods ended September 30, 1999 was
[EURO]4,849, [EURO]1,281 and [EURO]5,517, respectively.
During the nine months ended September 30, 2000, DaimlerChrysler purchased
and re-issued Ordinary Shares in connection with an employee share purchase
plan. At September 30, 2000, an insignificant number of Ordinary Shares were
held in treasury designated for future issuances under employee share purchase
plans.
In April 2000, the Group's shareholders agreed to increase the amount of
capital stock per share from approximately [EURO]2.56 (originating from the
conversion of Deutsche Marks into euros) to [EURO]2.60. This resulted in an
increase of capital stock and an equivalent decrease of additional paid-in
capital of [EURO]44. The conditional and authorized capital as described in the
Articles of Association were adjusted accordingly. DaimlerChrysler is authorized
to issue convertible bonds and notes with warrants in a nominal volume of up to
[EURO]15,000 with a term of up to 20 years by April 18, 2005. The convertible
bonds and notes with warrants shall grant to the holders or creditors option or
conversion rights for new shares in DaimlerChrysler in an amount not to exceed
[EURO]300 of capital stock. DaimlerChrysler is also entitled to grant up to
96,000,000 rights (representing up to approximately [EURO]250 of capital stock)
with respect to the DaimlerChrysler Stock Option Plan by April 18, 2005 (see
also Note 10). Finally, DaimlerChrysler is authorized through October 18, 2001,
to acquire treasury stock for certain defined purposes up to a maximum of
[EURO]256 of capital stock, representing approximately 10% of issued and
outstanding capital stock.
F-14
<PAGE>
DAIMLERCHRYSLER AG
NOTES TO UNAUDITED INTERIM CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS
(IN MILLIONS)
10. STOCK-BASED COMPENSATION
In April 2000, the Group's shareholders approved the DaimlerChrysler Stock
Option Plan 2000 (the "Plan") which provides for the granting of stock options
for the purchase of DaimlerChrysler Ordinary Shares to eligible employees.
Options granted under the Plan are exercisable at a reference price per
DaimlerChrysler Ordinary Share determined by the Supervisory Board plus a 20%
premium. The options become exercisable in equal installments on the second and
third anniversaries from the date of grant. All unexercised options expire ten
years from the date of grant. If the market price per DaimlerChrysler Ordinary
Share on the date of exercise is at least 20% higher than the reference price,
the holder is entitled to receive a cash payment equal to the original exercise
premium of 20%. During the first half of 2000, the Group issued 15.6 million
options at a reference price of [EURO]62.30. In May 2000, certain shareholders
challenged the approval of the Plan at the stockholders' meeting on April 19,
2000. In October 2000, a regional court in Stuttgart (the Landgericht) dismissed
the case.
11. ACCRUED LIABILITIES
Accrued liabilities are comprised of the following:
<TABLE>
<CAPTION>
At September 30, At December 31,
2000 1999
---------------- ----------------
<S> <C> <C>
Pension plans and similar obligations .......... [EURO]11,850 [EURO]14,048
Income and other taxes ......................... 1,587 2,281
Other accrued liabilities ...................... 22,878 21,366
------------ -------------
36,315 37,695
============ =============
</TABLE>
In January 2000, DaimlerChrysler AG contributed an additional [EURO]1,275 of
securities to the DaimlerChrysler Pension Trust.
F-15
<PAGE>
DAIMLERCHRYSLER AG
NOTES TO UNAUDITED INTERIM CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS
(IN MILLIONS)
12. SEGMENT REPORTING
Segment information for the three-month periods ended September 30, 2000 and
1999 follows (in [EURO]):
<TABLE>
<CAPTION>
Mercedes-
Benz
Passenger
Cars Chrysler Commercial Elimi- Consoli-
& smart Group Vehicles Services Aerospace Other nations dated
--------- -------- ---------- -------- --------- ------- ------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
September 30, 2000
Revenues .............. 10,029 14,764 6,357 4,042 496 1,473 -- 37,161
Intersegment sales .... 499 453 149 784 5 33 (1,923) --
------- ------- ------- ------- ------- ------- ------- -------
Total revenues ........ 10,528 15,217 6,506 4,826 501 1,506 (1,923) 37,161
Operating Profit (Loss) 816 (579) 290 (424) 3,357 4 (2) 3,462
September 30, 1999
Revenues .............. 8,894 14,986 6,269 2,786 2,089 1,208 -- 36,232
Intersegment sales .... 280 180 322 548 16 97 (1,443) --
------- ------- ------- ------- ------- ------- ------- -------
Total revenues ........ 9,174 15,166 6,591 3,334 2,105 1,305 (1,443) 36,232
Operating Profit (Loss) 708 1,025 303 1,167 185 (55) (18) 3,315
</TABLE>
Segment information for the nine-month periods ended September 30, 2000 and
1999 follows (in [EURO]):
<TABLE>
<CAPTION>
Mercedes-
Benz
Passenger
Cars Chrysler Commercial Elimi- Consoli-
& smart Group Vehicles Services Aerospace Other nations dated
--------- -------- ---------- -------- --------- ------- ------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
September 30, 2000
Revenues .............. 29,898 51,623 20,099 11,236 4,793 4,213 -- 121,862
Intersegment sales .... 1,937 603 727 2,131 18 218 (5,634) --
------- ------- ------- ------- ------- ------- ------- -------
Total revenues ........ 31,835 52,226 20,826 13,367 4,811 4,431 (5,634) 121,862
Operating Profit (Loss) 2,160 1,937 915 (9) 3,719 (131) (51) 8,540
September 30, 1999
Revenues .............. 26,283 46,436 18,305 7,675 6,319 3,530 -- 108,548
Intersegment sales .... 902 283 1,110 1,504 24 281 (4,104) --
------- ------- ------- ------- ------- ------- ------- -------
Total revenues ........ 27,185 46,719 19,415 9,179 6,343 3,811 (4,104) 108,548
Operating Profit (Loss) 1,855 3,803 805 1,872 467 (153) (3) 8,646
</TABLE>
The Aerospace segment is comprised of the continuing activities of the Aero
Engines business unit and the activities of the aerospace business through July
10, 2000, the date that the shares of DaimlerChrysler Aerospace were exchanged
for shares in EADS (see Note 5).
F-16
<PAGE>
DAIMLERCHRYSLER AG
NOTES TO UNAUDITED INTERIM CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS
(IN MILLIONS)
A reconciliation to operating profit follows (in [EURO]):
<TABLE>
<CAPTION>
Three months ended Nine months ended
September 30, September 30,
------------------ --------------------
2000 1999 2000 1999
------- ------ ------- --------
<S> <C> <C> <C> <C>
Income before financial income ........ 236 2,288 5,501 7,129
Pension and postretirement benefit
expenses other than service cost (94) 83 (186) 258
Operating income from affiliated,
associated and related companies 100 (42) 133 2
Gains on disposals of businesses . 3,269 886 3,269 1,142
Miscellaneous .................... (49) 100 (177) 115
------ ------ ------ ------
Consolidated operating profit ......... 3,462 3,315 8,540 8,646
====== ====== ====== ======
</TABLE>
13. EARNINGS PER SHARE
The computation of basic and diluted earnings per share for "Income before
extraordinary item and cumulative effects of changes in accounting principles"
is as follows (in millions of [EURO] or millions of shares, except earnings per
share):
<TABLE>
<CAPTION>
Three months ended Nine months ended
September 30, September 30,
------------------- --------------------
2000 1999 2000 1999
------- ------- -------- --------
<S> <C> <C> <C> <C>
Income before extraordinary item and
cumulative effects of changes in
accounting principles - basic ........ 121 1,425 3,562 3,951
Interest expense on convertible bonds
and notes (net of tax) ............. 4 5 13 14
------- ------- ------- --------
Income before extraordinary item and
cumulative effects of changes in
accounting principles - diluted ...... 125 1,430 3,575 3,965
======= ======= ======= ========
Weighted average number of shares
outstanding - basic .................. 1,003.3 1,003.2 1,003.1 1,002.8
Dilutive effect of convertible bonds
and notes ........................ 10.7 10.8 10.7 10.8
------- ------- ------- --------
Weighted average number of shares
outstanding - diluted ................ 1,014.0 1,014.0 1,013.8 1,013.6
======= ======= ======= ========
EARNINGS PER SHARE BEFORE EXTRAORDINARY
ITEM AND CUMULATIVE EFFECTS OF CHANGES
IN ACCOUNTING PRINCIPLES
Basic ................................ 0.12 1.42 3.55 3.94
======= ======= ======= ========
Diluted .............................. 0.12 1.41 3.53 3.91
======= ======= ======= ========
</TABLE>
Options issued in connection with the 2000 Stock Option Plan were not
included in the computation of diluted earnings per share because the options'
underlying exercise price was greater than the average market price for
DaimlerChrysler Ordinary Shares during the respective period.
An income tax charge of [EURO]597 relating to changes in German tax laws was
included in the consolidated statement of income for the nine months ended
September 30, 1999 and resulted in a reduction of basic and diluted earnings per
share of [EURO]0.60 and [EURO]0.59, respectively.
F-17
<PAGE>
DAIMLERCHRYSLER AG
NOTES TO UNAUDITED INTERIM CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS
(IN MILLIONS)
14. SUMMARIZED FINANCIAL INFORMATION
Summarized financial information for DaimlerChrysler North America Holding
Corporation, DaimlerChrysler Corporation and Chrysler Financial Company, L.L.C.
and their respective consolidated subsidiaries is set forth below (in millions
of U.S. $):
<TABLE>
<CAPTION>
DAIMLERCHRYSLER NORTH AMERICA HOLDING
CORPORATION AND CONSOLIDATED September 30, December 31,
SUBSIDIARIES*) 2000 1999
-------- --------
<S> <C> <C>
Cash, cash equivalents and securities .... $ 7,507 $ 9,624
Receivables from financial services ...... 34,915 26,515
Property and equipment, net .............. 26,279 24,737
Equipment on operating leases, net ....... 27,303 22,898
Other assets ............................. 26,807 25,146
-------- --------
TOTAL ASSETS ............................. 122,811 108,920
======== ========
Current liabilities ...................... 53,971 54,137
Non-current liabilities .................. 47,991 35,099
Stockholder's equity ..................... 20,849 19,684
-------- --------
TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY 122,811 108,920
======== ========
</TABLE>
<TABLE>
<CAPTION>
Three months ended Nine months ended
September 30, September 30,
---------------------- ---------------------
2000 1999 2000 1999
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Revenues:
Net sales of products $ 17,964 $ 21,172 $ 64,599 $ 65,772
Finance and insurance
revenues ........... 2,717 1,841 7,645 5,280
Total expenses ......... 21,163 22,091 70,630 67,553
Net income (loss) before
cumulative effects of
changes in accounting
principles ........... (482) 922 1,614 3,499
Net income (loss) ...... (576) 922 1,514 3,499
</TABLE>
*) Effective December 31, 1999, DaimlerChrysler AG contributed its shares of
DaimlerChrysler Corporation to DaimlerChrysler North America Holding
Corporation. Accordingly, prior period amounts have been restated to
include the accounts of DaimlerChrysler Corporation and consolidated
subsidiaries.
F-18
<PAGE>
DAIMLERCHRYSLER AG
NOTES TO UNAUDITED INTERIM CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS
(IN MILLIONS)
<TABLE>
<CAPTION>
DAIMLERCHRYSLER CORPORATION September 30, December 31,
AND CONSOLIDATED SUBSIDIARIES**) 2000 1999
------------- ------------
<S> <C> <C>
Cash, cash equivalents and securities .... $ 6,152 $ 8,671
Receivables from financial services ...... 23,001 15,887
Property and equipment, net .............. 24,533 23,131
Other assets ............................. 40,157 35,897
------- -------
TOTAL ASSETS ............................. 93,843 83,586
======= =======
Current liabilities ...................... 37,122 36,942
Non-current liabilities .................. 39,778 30,957
Stockholder's equity ..................... 16,943 15,687
------- -------
TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY 93,843 83,586
======= =======
</TABLE>
<TABLE>
<CAPTION>
Three months ended Nine months ended
September 30, September 30,
------------------------- -------------------------
2000 1999 2000 1999
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Revenues:
Net sales of products ........... $ 13,371 $ 15,577 $ 48,521 $ 49,605
Finance and insurance
revenues ...................... 2,055 1,384 5,421 3,727
Total expenses .................... 15,890 16,183 52,578 50,320
Net income (loss) before
cumulative effects of
changes in accounting
principles ...................... (464) 778 1,364 3,012
Net income (loss) ................. (555) 778 1,275 3,012
</TABLE>
**) Including Chrysler Financial Company, L.L.C. and consolidated
subsidiaries.
<TABLE>
<CAPTION>
CHRYSLER FINANCIAL COMPANY, L.L.C. September 30, December 31,
AND CONSOLIDATED SUBSIDIARIES 2000 1999
------- -------
<S> <C> <C>
Finance receivables and retained interests, net .... $25,849 $19,558
Vehicles leased, net ............................... 14,218 12,238
Loans and other amounts due from affiliates ........ 1,707 1,852
Other assets ....................................... 2,402 1,719
------- -------
TOTAL ASSETS ....................................... 44,176 35,367
======= =======
Current liabilities ................................ 13,411 15,135
Non-current liabilities ............................ 27,561 16,844
Member's interest .................................. 3,204 3,388
------- -------
TOTAL LIABILITIES AND MEMBER'S INTEREST ............ 44,176 35,367
======= =======
</TABLE>
F-19
<PAGE>
DAIMLERCHRYSLER AG
NOTES TO UNAUDITED INTERIM CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS
(IN MILLIONS)
<TABLE>
<CAPTION>
CHRYSLER FINANCIAL COMPANY,
L.L.C. AND CONSOLIDATED Three months Nine months
SUBSIDIARIES ended September 30, ended September 30,
--------------------- ----------------------
2000 1999 2000 1999
--------- --------- ---------- ----------
<S> <C> <C> <C> <C>
Net margin and other revenues
(expenses) ...................... $ (52) $ 412 $ 594 $1,260
Total costs and expenses ......... 263 262 749 782
Net earnings (losses) before
cumulative effect of a
change in accounting
principle ...................... (253) 102 (110) 323
Net earnings (losses) ............ (344) 102 (201) 323
</TABLE>
Separate full consolidated financial statements of DaimlerChrysler North
America Holding Corporation, DaimlerChrysler Corporation and Chrysler Financial
Company, L.L.C. and their respective consolidated subsidiaries are not presented
as management has determined that such information is not material to holders of
the outstanding debt securities. Certain prior year amounts for DaimlerChrysler
Corporation and Chrysler Financial Company, L.L.C. have been restated to
conform to the current year presentation.
15. PENDING TRANSACTION
In August 2000, DaimlerChrysler signed a sale and purchase agreement with the
Canadian company Bombardier Inc. for the acquisition of DaimlerChrysler Rail
Systems GmbH (Adtranz), for a cash consideration of $725 (approximately
[EURO]800). The purchase price is subject to adjustments including an increase
or a reduction to reflect the proceeds from the planned disposal of Adtranz's
Fixed installations and Signaling businesses and adjustments based on the
financial performance of Adtranz until the closing date of the transaction. The
acquisition is subject to appropriate regulatory approvals.
16. SUBSEQUENT EVENTS
In July 2000, the Group agreed to acquire all remaining outstanding shares of
Detroit Diesel Corporation for approximately [EURO]500. The acquisition of the
remaining 78.7% interest in Detroit Diesel Corporation was completed in October
2000.
In March 2000, DaimlerChrysler and Mitsubishi Motors Corporation signed a
Letter of Intent to form an alliance regarding the design, development,
production and distribution of passenger cars and light commercial vehicles. The
agreement excludes medium and heavy trucks and other commercial vehicles. Under
the terms of the Master Alliance Agreement amended in September 2000,
DaimlerChrysler planned to receive a 34% equity interest in Mitsubishi Motors
Corporation for approximately [EURO]2,100 through newly issued capital stock. In
combination with the closing of the transaction, DaimlerChrysler also planned to
purchase convertible bonds of Mitsubishi Motors Corporation for approximately
[EURO]200. The transactions were consummated in October 2000.
Moreover, in March 2000, DaimlerChrysler and Deutsche Telekom agreed to
combine their information technology activities in a joint venture. As part of
the agreement, Deutsche Telekom will receive a 50.1% interest in debis
Systemhaus through a capital investment in debis Systemhaus. The transaction was
completed in October 2000.
F-20
<PAGE>
2
<PAGE>
DAIMLERCHRYSLER
INTERIM REPORT
Q3 2000
<PAGE>
<TABLE>
<CAPTION>
CONTENTS
<S> <C>
Business Review 3
Mercedes-Benz Passenger Cars & smart 6
Chrysler Group 7
Commercial Vehicles 8
Services 9
Aerospace 10
Other Industrial Businesses 11
Analysis of the Financial Situation 12
Consolidated Financial Statements 15
Disclosure Schedule 19
</TABLE>
DAIMLERCHRYSLER
<TABLE>
<CAPTION>
Q3 00 Q3 00 Q3 99 % change
AMOUNTS IN MILLIONS US $ (2) [EURO] [EURO]
------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
REVENUES 32,839 37,161 36,232 3 (1)
European Union 10,710 12,119 10,948 11
Germany 6,205 7,022 7,664 (8)
USA 16,766 18,973 19,328 (2)
Other Markets 5,363 6,069 5,956 2
EMPLOYEES (Sep. 30) 440,287 466,520 (6)
INVESTMENTS IN PROPERTY, PLANT AND EQUIPMENT 2,173 2,459 2,078 18
CASH PROVIDED BY OPERATING ACTIVITIES 2,769 3,133 5,552 (44)
OPERATING PROFIT 3,059 3,462 3,315 4
OPERATING PROFIT ADJUSTED (3) 477 540 2,568 (79)
NET INCOME 2,663 3,014 1,960 54
NET INCOME ADJUSTED (3) 289 327 1,511 (78)
Basic Earnings per Share (in US $/[EURO]) 2.66 3.01 1.95 54
Basic Earnings per Share adjusted (3) (in US $/[EURO]) 0.29 0.33 1.51 (78)
------------------------------------------------------------------------------------------------------------
</TABLE>
1) An 8% increase after adjusting for changes in the consolidated group.
<TABLE>
<CAPTION>
Q1-3 00 Q1-3 00 Q1-3 99
AMOUNTS IN MILLIONS US $ (2) [EURO] [EURO] % change
------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
REVENUES 107,689 121,862 108,548 12 (4)
European Union 33,521 37,933 35,774 6
Germany 17,091 19,340 21,420 (10)
USA 56,520 63,958 57,796 11
Other Markets 17,648 19,971 14,978 33
EMPLOYEES (Sep. 30) 440,287 466,520 (6)
INVESTMENTS IN PROPERTY, PLANT AND EQUIPMENT 6,744 7,632 6,005 27
CASH PROVIDED BY OPERATING ACTIVITIES 12,526 14,175 13,299 7
OPERATING PROFIT 7,547 8,540 8,646 (1)
OPERATING PROFIT ADJUSTED (3) 4,965 5,618 7,643 (26)
NET INCOME 5,715 6,467 4,610 40
NET INCOME ADJUSTED (3) 3,330 3,768 4,634 (19)
Basic Earnings per Share (in US $/[EURO]) 5.70 6.45 4.60 40
Basic Earnings per Share adjusted (3) (in US $/[EURO]) 3.32 3.76 4.62 (19)
------------------------------------------------------------------------------------------------------------
</TABLE>
Certain prior year balances have been reclassified to conform with current
year presentation.
2) Rate of exchange: [EURO]1 = US $0.8837 (based on the noon buying rate on
September 29, 2000).
3) Excluding one-time effects.
4) A 14% increase after adjusting for changes in the consolidated group.
<PAGE>
<TABLE>
<CAPTION>
REVENUES OPERATING PROFIT NET INCOME EARNINGS PER
in billions of [EURO] in billions of [EURO] in billions of [EURO] SHARE
in [EURO]
1999 2000 1999 2000 2000 2000 1999 2000
-------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Q1 35.0 41.0 2.8 2.5 1.2 1.7 1.16 1.70
Q2 37.3 43.7 2.6 2.6 1.5 1.7 1.48 1.74
Q3 36.2 37,2 3.3 3.5 2.0 3.0 1.95 3.01
Q4 41.4 - 2.4 - 1.1 - 1.13 -
</TABLE>
<TABLE>
<CAPTION>
OPERATING PROFIT NET INCOME EARNINGS PER
ADJUSTED ADJUSTED SHARE ADJUSTED
in billions of [EURO] in billions of [EURO] in [EURO]
1999 2000 2000 2000 1999 2000
-------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Q1 2.5 2.5 1.6 1.7 1.64 1.69
Q2 2.6 2.6 1.5 1.7 1.48 1.74
Q3 2.6 0.5 1.5 0.3 1.51 0.33
Q4 2.7 - 1.6 - 1.59 -
</TABLE>
2
<PAGE>
BUSINESS REVIEW - FURTHER REVENUE GROWTH AT DAIMLERCHRYSLER
o REVENUES ON A COMPARABLE BASIS ROSE BY 8% OVER THE 3RD QUARTER
OF 1999 TO [EURO]37.2 BILLION, AS A RESULT OF GOOD PROGRESS
WITHIN MERCEDES-BENZ PASSENGER CARS & SMART AND SERVICES.
o OPERATING PROFIT AT [EURO]3.5 BILLION, SLIGHTLY ABOVE LAST YEAR,
HAVING BENEFITED IN PARTICULAR FROM THE EXCHANGE OF SHARES IN
DASA FOR SHARES IN EADS WHICH YIELDED ONE-TIME INCOME OF [EURO]
3.3 BILLION.
o UNDERLYING OPERATING PROFIT, ADJUSTED FOR ONE-TIME EFFECTS, FELL
FROM [EURO]2.6 BILLION TO [EURO]0.5 BILLION, REFLECTING PRESSURE
ON MARGINS IN THE US AND THE COSTS OF INTRODUCING NEW PRODUCTS
BY THE CHRYSLER GROUP.
o NET INCOME ROSE FROM [EURO]2.0 BILLION TO [EURO]3.0 BILLION.
ADJUSTED FOR ONE-TIME EFFECTS NET INCOME WAS DOWN FROM [EURO]1.5
BILLION TO [EURO]0.3 BILLION. EARNINGS PER SHARE ROSE BY 54% TO
[EURO]3.01 (1999: [EURO]1.95) AND ADJUSTED FOR ONE-TIME EFFECTS
THEY MOVED DOWN FROM [EURO]1.51 TO [EURO]0.33.
o OPERATING PROFIT FOR THE FULL YEAR IS EXPECTED TO BE AROUND THE
[EURO]11 BILLION LEVEL ACHIEVED IN 1999; ALTHOUGH ADJUSTED FOR
ONE-TIME EFFECTS, AND REFLECTING A LIKELY CONTINUATION OF
DIFFICULT MARKET CONDITIONS IN THE US, ONGOING OPERATING PROFIT
IS EXPECTED TO BE AROUND [EURO]7 BILLION, AS PREVIOUSLY
INDICATED (1999: [EURO]10.0 BILLION).
o COMPREHENSIVE COST CUTTING PROGRAMS IN ALL DIVISIONS AND
HEADQUARTER DEPARTMENTS UNDERWAY; MEASURES INCLUDE A REVIEW OF
ALL PROCESSES ALONG THE AUTOMOTIVE VALUE CHAIN.
o OUTLOOK 2001: A VARIETY OF NEW AND ATTRACTIVE PRODUCTS SHOULD
POSITIVELY INFLUENCE UNIT SALES AND REVENUES; TOUGH MARKET
CONDITIONS IN THE US EXPECTED TO INTENSIFY; OTHER MARKETS
WILL PROVIDE OPPORTUNITIES.
FURTHER INCREASE IN REVENUES
o DaimlerChrysler again recorded higher revenues this quarter. Revenues
calculated on a comparable basis rose by 8% to [EURO]37.2 billion; Dasa
(excluding the Aero Engines business unit) ceased to be a part of the
consolidated group in July and the resultant EADS venture is accounted
for at-equity.
o The automotive divisons generated the following shares of total
revenues: Mercedes-Benz Passenger Cars & smart 27%, Chrysler Group 40%
and Commercial Vehicles 17%.
o Unit sales of vehicles by the DaimlerChrysler Group fell in the 3rd
quarter by 9% to 1,024,800 vehicles. While unit sales at Mercedes-Benz
Passenger Cars & smart continued to rise by 4% despite the backdrop of a
significant increase in fuel prices, sales at Chrysler Group and
Commercial Vehicles decreased by 14% and 10%, respectively.
OPERATING PROFIT AT [EURO]3.5 BILLION IN LINE WITH LAST YEAR; ADJUSTED FOR
ONE-TIME EFFECTS LOWER THAN 1999
o DaimlerChrysler's operating profit of [EURO]3.5 billion was similar to
the figure recorded in the 3rd quarter of last year ([EURO]3.3 billion).
In the 3rd quarter of 2000 the exchange of shares in Dasa for shares in
EADS yielded one-time income of [EURO]3.3 billion, and the write-down of
residual values of leased vehicles resulted in a charge of [EURO]0.5
billion. In the 3rd quarter of last year, one-time effects resulted in
income of [EURO]0.7 billion, primarily as a result of the sale of
debitel shares.
o After adjusting for one-time effects in the 3rd quarter of both years,
operating profit of [EURO]0.5 billion was lower than the high level of
the previous year ([EURO]2.6 billion), as Chrysler Group and Services
earnings were depressed by more difficult market conditions.
3
<PAGE>
o Due to higher unit sales and revenues in the 3rd quarter, operating
profit adjusted for one-time effects at Mercedes-Benz Passenger Cars &
smart exceeded last year's level by 5%. Commercial Vehicles produced
operating profit of [EURO]290 million, close to the high level achieved
in the previous year, despite tough market conditions in the US.
o Due to very intense competition in the North American market, which
necessitated high marketing expenditures, as well as the start-up costs
for new products, the Chrysler Group recorded an operating loss of [EURO]
0.6 billion for the 3rd quarter (Q3/1999 profit of [EURO]1.0 billion).
o Difficult market conditions, particularly in the US, also had a negative
impact on the earnings of the Services division. An impairment charge of
[EURO]0.5 billion was recorded for residual values of leased vehicles to
account for decreasing prices of used vehicles.
o Net income increased from [EURO]2.0 billion to [EURO]3.0 billion and basic
earnings per share rose from [EURO]1.95 to [EURO]3.01. Excluding one-time
effects, net income declined in the 3rd quarter from [EURO]1.5 billion to
[EURO]0.3 billion. Basic earnings per share, adjusted for one-time effects,
amounted to [EURO]0.33 (Q3/1999: [EURO]1.51).
FURTHER CONCENTRATION ON THE AUTOMOTIVE BUSINESS AND RELATED SERVICES
o During 2000 DaimlerChrysler has made significant progress in focusing on
the automotive business and related services segments, as evidenced by
alliances with Mitsubishi Motors and Hyundai Motor Company, the
foundation of EADS and the IT joint venture with Deutsche Telekom.
o On August 4, 2000, DaimlerChrysler announced the sale of Adtranz to the
international aerospace and rail systems group, Bombardier Inc. of
Canada.
STRONGER INFLUENCE AT MITSUBISHI MOTORS
o In March 2000 DaimlerChrysler announced its alliance with Mitsubishi
Motors. In recent negotiations the agreement has been substantially
improved:
o After three years, DaimlerChrysler may increase its stake in Mitsubishi
Motors without limit.
o The price to be paid for the 34% stake in Mitsubishi Motors will be
reduced by 10% to [EURO]2.2 billion.
o DaimlerChrysler will appoint the Chief Operating Officer as an
additional board member, enlarging the Mitsubishi Motors board from 10
to 11 members. DaimlerChrysler will thus appoint four of Mitsubishi
Motors' board members and will also provide additional personnel. This
will assist the independent Mitsubishi management in achieving the
necessary turnaround.
CONSOLIDATION OF E-BUSINESS ACTIVITIES AT DCX.NET
o On October 9, 2000, DaimlerChrysler announced the establishment of
DCX.NET Holding GmbH, which will combine all of the Group's existing and
future e-business investments and participations. The company has an
initial capitalization of [EURO]550 million.
o The aim of the DCX.NET initiative is to make DaimlerChrysler quicker,
more efficient and therefore more competitive in all areas - from
procurement to sales. The primary goal is to make DaimlerChrysler into a
totally networked corporation. The DCX.NET initiative will include
business-to-business (B2B) and business-to-customer (B2C) processes, and
will also integrate all business-to-employee (B2E) and telematics
activities.
SECURING A COMPETITIVE ADVANTAGE
o At the end of the 3rd quarter, DaimlerChrysler's workforce numbered
around 440,300, although this figure is not directly comparable to 1999
especially due to the transfer of the Dasa staff to EADS. Indeed, after
adjusting for such changes in the consolidated group, employee numbers
rose by 3%. In particular, this was a function of a 23% headcount
increase within the Services division, as a result of new jobs in the IT
Services business unit. Employees in Mercedes-Benz Passenger Cars &
smart as well as in the Commercial Vehicles division were at similar
levels to last year, while Chrysler Group reduced its workforce (before
adjusting for changes in the consolidated group) by 2%.
o DaimlerChrysler remains committed to retaining its competitive position
within the industry and in this context has initiated a detailed
examination of its cost structures within all its business areas and at
the headquarters level. The measures will affect the entire value chain.
OUTLOOK
o DaimlerChrysler revenues for the full year are expected to be at
approximately [EURO]160 billion, notwithstanding the transactions
involving Dasa in July and debis Systemhaus in October of 2000. On a
comparable basis this represents an increase of 11%.
o In the 4th quarter DaimlerChrysler expects an overall positive trend for
vehicle unit sales. During the whole of 2000 the Group expects to sell
over 4.8 million vehicles - similar to the volume achieved in 1999.
o The strong demand for our premium-brand Mercedes-Benz Passenger Cars &
smart products is expected to lead to a new unit sales record for this
division. The division also expects to exceed last year's high figures
for both revenues (1999: [EURO]38.1 billion) and earnings (1999: [EURO]2.7
billion). The division anticipates that it will sell more than 100,000
smart cars for the first time in a year.
4
<PAGE>
o Despite the intensely competitive automobile market in the US and
numerous model launches, which depress unit sales (factory shipments)
because of the start-up curve, the Chrysler Group is expected to sell
around 3.2 million vehicles worldwide, thus equaling the very high
figure attained last year. Chrysler Group is expected to achieve
positive earnings once again in the 4th quarter and its operating profit
for the full year is expected to be above [EURO]2.0 billion (1999: [EURO]
5.1 billion).
o Unit sales by the Commercial Vehicles division are expected to be only
slightly below the figure for 1999 (554,900), despite the strong decline
in demand for heavy trucks in the US. Present indications for operating
profit, however, suggest that the figure will be above 1999 levels.
o The combination of the areas, Powertrain, MTU/Diesel Engines and Detroit
Diesel are expected to bring the Group substantial cost advantages and
growth opportunities in the medium term.
o DaimlerChrysler also expects strong revenue growth for Services in the
4th quarter. A modified leasing strategy will aim to limit penetration
rates of individual models, and an innovative marketing campaign will be
implemented to promote the sale of used vehicles.
o DaimlerChrysler anticipates that operating profit for the full year,
including all one-time income and expenses, will be at the same level as
in 1999. Net income and basic earnings per share should be well above
the corresponding figures for last year. After adjusting for the
one-time effects, however, DaimlerChrysler expects operating profit for
the year 2000 to be around [EURO]7 billion, as already announced
(comparable figure for 1999: [EURO]10.0 billion).
o In 2001 a variety of new and attractive products should positively
influence unit sales and revenues at DaimlerChrysler. However, tough
market conditions in the US are expected to intensify; other markets will
provide opportunities.
Share Price Index
(as of January 3, 2000)
<TABLE>
<CAPTION>
MSCI Automobiles
DaimlerChrysler DAX Index
<S> <C> <C> <C>
January 3, 2000 100 100 100
January 31, 2000 90 101 92
February 29, 2000 95 113 86
March 31, 2000 92 113 100
April 28, 2000 87 110 100
May 31, 2000 79 105 90
June 30, 2000 74 102 88
July 31, 2000 77 107 86
August 31, 2000 78 107 87
September 29, 2000 69 101 83
October 13, 2000 72 99 83
</TABLE>
5
<PAGE>
MERCEDES-BENZ PASSENGER CARS & SMART
o FURTHER INCREASE IN UNIT SALES, REVENUES AND OPERATING PROFIT
o STRONG DEMAND FOR THE NEW C-CLASS
o STRONG INCREASE IN SMART UNIT SALES
<TABLE>
<CAPTION>
Q3 00 Q3 00 Q3 99 % CHANGE
Amounts in millions US $ [EURO] [EURO]
--------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Operating Profit 721 816 708 +15
Operating Profit adjusted 657 743 708 +5
Revenues 9,304 10,528 9,174 +15
Unit Sales 275,349 265,519 +4
Production 276,944 264,996 +5
Employees (Sep. 30) 100,923 101,749 (1)
--------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
Unit Sales Q3 00 Q3 99 % change
---------------------------------------------------
<S> <C> <C> <C>
Total 275,349 265,519 +4
Western Europe 195,767 184,153 +6
Germany 115,053 105,929 +9
USA 43,257 45,838 (6)
Japan 6,948 10,559 (34)
Other Markets 29,377 24,969 +18
---------------------------------------------------
</TABLE>
MERCEDES-BENZ UNIT SALES CONTINUE TO RISE
o The Mercedes-Benz Passenger Cars & smart division increased its unit
sales by 4% to more than 275,300 vehicles in the 3rd quarter. Despite
higher expenditures for the development of new products, operating
profit adjusted for one-time effects increased by 5% to [EURO]743
million.
o Mercedes-Benz Passenger Cars strengthened its sales in almost all
regions. The division achieved a 3% increase in worldwide unit sales to
249,500 Mercedes-Benz cars, with growth in Western Europe (+6%), Eastern
Europe (+63%), Asia (+5%) and Australia (+28%). Unit sales also rose in
Germany (+9%), despite the distinct downward trend of this market.
o Among the model segments, there were large increases particularly for
the S-Class (+21%) and the C-Class (+15%).
o Due to strong demand and a rapid production start-up, the division was
able to sell 47,600 vehicles of the new C-Class sedan in the 3rd
quarter. This new model was not launched in the US and Japan until the
end of September.
EXPANDED PRODUCTION CAPACITY
o In September, production of the right-hand-drive version of the C-Class
sedan was started in South Africa with a capacity of 40,000 cars per
year.
o In addition, from 2001 Mercedes-Benz Passenger Cars will produce up to
10,000 C-Class cars per year in Brazil for overseas markets.
o By the end of 2003, production capacity in Tuscaloosa, USA is to be
doubled for the new M-Class model and additional versions. The total
investment will amount to US $600 million.
CONTINUED GROWTH OF SMART UNIT SALES
o The smart's positive trend continued in the 3rd quarter with unit sales
rising by 13% to 25,900 cars. The attractive smart cdi clearly dominates
the European market for "3-liter" cars (fuel consumption per 100 km) and
is also Number 1 in Germany in its segment.
OUTLOOK
o The introduction of the right-hand-drive version of the C-Class, as well
as the launch of this model in the US, should provide another boost to
unit sales. This year, for the first time, sales of over 200,000
Mercedes-Benz cars are expected in the US alone. Overall, new records
for unit sales, revenues and earnings are likely to be set in the year
2000.
<TABLE>
<CAPTION>
Amounts in millions Q1-3 00 Q1-3 00 Q1-3 99 % change
US $ [EURO] [EURO]
------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Operating Profit 1,909 2,160 1,855 +16
Operating Profit adjusted 1,844 2,087 1,855 +13
Revenues 28,133 31,835 27,185 +17
Unit Sales 845,439 784,613 +8
Production 856,781 814,240 +5
Employees (Sep. 30) 100,923 101,749 (1)
------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
Unit Sales Q1-3 00 Q1-3 99 % change
---------------------------------------------------
<S> <C> <C> <C>
Total 845,439 784,613 +8
Western Europe 582,240 545,734 +7
Germany 321,738 306,013 +5
USA 150,649 138,040 +9
Japan 28,323 37,561 (25)
Other Markets 84,227 63,278 +33
---------------------------------------------------
</TABLE>
6
<PAGE>
CHRYSLER GROUP
o LAUNCH OF NEW MINIVANS AND SEBRING/STRATUS MODELS
o DIFFICULT US MARKET
o MEASURES TO IMPROVE EARNINGS ALREADY BEING IMPLEMENTED
<TABLE>
<CAPTION>
Amounts in millions Q3 00 Q3 00 Q3 99 % change
US $ [EURO] [EURO]
---------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Operating Profit (512) (579) 1,025 .
Operating Profit adjusted (512) (579) 1,164 .
Revenues 13,447 15,217 15,166 +0
Unit Sales
(Factory Shipments) 623,031 722,384 (14)
Production 599,356 705,770 (15)
Employees (Sep. 30) 125,048 127,668 (2)
---------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
Unit Sales Q3 00 Q3 99 % change
---------------------------------------------------
<S> <C> <C> <C>
Total 623,031 722,384 (14)
NAFTA 582,481 682,952 (15)
USA 521,599 611,093 (15)
Other Markets 40,550 39,432 +3
---------------------------------------------------
</TABLE>
NUMEROUS MODEL CHANGES IN THE 3RD QUARTER
o In the 3rd quarter, unit sales (factory shipments) by the Chrysler Group
division of 623,000 vehicles were 14% lower than the corresponding
figure for the previous year. This was a result of the launch of several
new products and the intense competition in the US market.
o Passenger car and minivan unit sales declined by 25% and 36%,
respectively, due to the model-change to the new Sebring convertible,
Sebring and Stratus sedans, and the Caravan, Voyager and Town & Country
minivans. Conversely, unit sales of 51,000 PT Cruisers again exceeded
our expectations for this model. Production capacity has already been
expanded, however, demand continues to exceed production.
o Due to the appreciation of the US dollar against the euro we were able
to achieve the same level of revenues as in the 3rd quarter of last
year, despite lower unit sales and the higher sales incentives
necessitated by tougher competition in the US.
o Lower unit sales, higher sales incentives for models at the end of their
lifecycle and for inventory reductions, and higher launch costs for the
new products resulted in an operating loss of [EURO]0.6 billion in the
third quarter.
OUTLOOK
o With the innovative new models already launched the Chrysler Group
should be able to further improve its competitive position and return to
profitability in the fourth quarter. For the full year we expect
operating profit of more than [EURO]2.0 billion. Additional new exciting
products like the all new Jeep and the Dodge Ram will follow in 2001.
o All product teams and functional areas have implemented measures
designed to achieve a sustained improvement in the Chrysler Group's
earnings by optimizing product mix while reducing costs. The measures
include enhancing the efficiency of all processes in development,
production and sales, and utilizing the full potential of the entire
supplier chain. In addition to measures already implemented the division
has intensified competitive benchmarking exercises.
<TABLE>
<CAPTION>
Amounts in millions Q1-3 00 Q1-3 00 Q1-3 99 % change
US $ [EURO] [EURO]
--------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Operating Profit 1,712 1,937 3,803 (49)
Operating Profit adjusted 1,712 1,937 3,942 (51)
Revenues 46,152 52,226 46,719 +12
Unit Sales
(Factory Shipments) 2,397,736 2,407,206 (0)
Production 2,361,903 2,374,658 (1)
Employees (Sep. 30) 125,048 127,668 (2)
--------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
Unit Sales Q1-3 00 Q1-3 99 % change
------------------------------------------------------
<S> <C> <C> <C>
Total 2,397,736 2,407,206 (0)
NAFTA 2,258,244 2,284,300 (1)
USA 1,969,330 2,033,755 (3)
Other Markets 139,492 122,906 +13
------------------------------------------------------
</TABLE>
7
<PAGE>
COMMERCIAL VEHICLES
o OPERATING PROFIT AT A HIGH LEVEL
o PRESENTATION OF TAILORED PACKAGES FOR VARIOUS CUSTOMER SEGMENTS
AT THE FRANKFURT MOTOR SHOW
o JOINT VENTURE WITH HYUNDAI WILL OPEN UP NEW MARKETS
<TABLE>
<CAPTION>
Amounts in millions Q3 00 Q3 00 Q3 99 % change
US $ [EURO] [EURO]
-------------------------------------------------------------
<S> <C> <C> <C> <C>
Operating Profit 256 290 303 (4)
Revenues 5,749 6,506 6,591 (1)
Unit Sales 126,388 140,864 (10)
Production 130,428 138,237 (6)
Employees (Sep. 30) 91,183 90,579 +1
-------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
Unit Sales Q3 00 Q3 99 % change
---------------------------------------------------
<S> <C> <C> <C>
Total 126,388 140,864 (10)
Western Europe 64,424 67,310 (4)
Germany 27,499 28,284 (3)
USA 26,207 44,508 (41)
Latin America 13,398 12,363 +8
Other Markets 22,359 16,683 +34
---------------------------------------------------
</TABLE>
OPERATING PROFIT AT A HIGH LEVEL
o With its attractive product range the Commercial Vehicles division
strengthened its worldwide leading position in the 3rd quarter.
o The positive unit-sales trend for Mercedes-Benz vans continued in the
3rd quarter (+1% to 55,100 vehicles), with the most important success
factors being the new CDI engines and the facelift for the Sprinter.
o With unit sales of 31,400 Mercedes-Benz trucks surpassed the figure
achieved in the 3rd quarter of last year by 8%, despite stronger
competition in Western Europe. Unit sales of Mercedes-Benz and Setra
buses increased by 5% in the 3rd quarter to 6,000 vehicles.
o On the other hand, as a result of the much weaker US market for heavy
trucks, worldwide unit sales by the brands, Freightliner, Sterling and
Thomas Built fell by 38% to 31,000 vehicles in the 3rd quarter.
o Operating profit in the 3rd quarter remained slightly below the high
level achieved in the same period of the previous year, particularly as
a result of lower sales in the US (-4%).
NEW PRODUCTS AND SERVICES AT THE FRANKFURT MOTOR SHOW
o At the 58th Commercial Vehicles Motor Show in Frankfurt, DaimlerChrysler
presented numerous new products, as well as a comprehensive range of
services related to commercial vehicles. For the first time a prototype
of a lightweight van was presented at the Motor Show: the
"Alu-Sprinter".
OUTLOOK
o For the full year 2000, we expect unit sales to be slightly below the
figure for 1999. Revenues, however, are projected to be about the same
as last year. The downturn in the NAFTA market should be more than
offset by positive developments in the other business units. Operating
profit in 2000 is estimated to be higher than in the previous year.
o Before the end of this year, the Sprinter will be presented to dealers
and customers in the US and Canada under the Freightliner brand, with
market launch planned for the first half of 2001. The acquisition of the
premium truck manufacturer, Western Star, and of Detroit Diesel
Corporation should enable us to further extend our leading position in
North America.
o The planned joint venture with Hyundai Motor provides us with access to
the Asian markets and to modern and extremely competitive production
facilities in South Korea. We intend to use Hyundai's existing sales
network to develop our business further in the dynamic Asian markets.
<TABLE>
<CAPTION>
Amounts in millions Q1-3 00 Q1-3 00 Q1-3 99 % change
US $ [EURO] [EURO]
-------------------------------------------------------------
<S> <C> <C> <C> <C>
Operating Profit 809 915 805 +14
Revenues 18,404 20,826 19,415 +7
Unit Sales 407,704 410,773 (1)
Production 423,064 417,351 +1
Employees (Sep. 30) 91,183 90,579 +1
-------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
Unit Sales Q1-3 00 Q1-3 99 % change
---------------------------------------------------
<S> <C> <C> <C>
Total 407,704 410,773 (1)
Western Europe 201,352 203,769 (1)
Germany 79,703 84,354 (6)
USA 106,751 130,123 (18)
Latin America 38,483 33,399 +15
Other Markets 61,118 43,482 +41
---------------------------------------------------
</TABLE>
8
<PAGE>
SERVICES
o CONTINUED STRONG REVENUE GROWTH FOR DEBIS
o EARNINGS IMPACTED BY ONE-TIME EFFECTS AND PRESSURE ON MARGINS
o IMPLEMENTATION OF JOINT VENTURE WITH DEUTSCHE TELEKOM
<TABLE>
<CAPTION>
Amounts in millions Q3 00 Q3 00 Q3 99 % change
US $ [EURO] [EURO]
---------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Operating Profit (375) (424) 1,167 .
Operating Profit adjusted 66 75 281 (73)
Revenues 4,265 4,826 3,334 +45
Contract Volume 113,430 128,358 87,921 +46
New Business 12,793 14,476 11,995 +21
Employees (Sep. 30) 30,933 25,136 +23
---------------------------------------------------------------------------
</TABLE>
SUBSTANTIAL REVENUE GROWTH, EARNINGS IMPACTED BY BUSINESS TREND IN NORTH
AMERICA
o The Services division boosted its revenues by a substantial 45% to [EURO]
4.8 billion in the 3rd quarter. debis achieved its strongest growth in
North America with an increase of 89%.
o Due to increased refinancing costs and the resulting pressure on
margins, operating profit adjusted for one-time effects fell to [EURO]75
million (Q3/1999: [EURO]281 million).
o The price incentives needed to maintain the market share of certain
Chrysler models led to lower residual values for leased vehicles. An
impairment charge of [EURO]0.5 billion was recorded for residual values of
leased vehicles to account for decreasing prices of used vehicles. In
the future, this situation will be counteracted by innovative marketing
measures for used vehicles, more intensive remarketing activities, and
the use of modern methods for the constant tracking of residual-value
developments.
FINANCIAL SERVICES' GROWTH TREND CONTINUES
o Financial Services' contract volume for the 3rd quarter increased by a
substantial 46% to [EURO]128.4 billion. There was also a strong rise in
new business of 21%, with above-average rates in the NAFTA market and in
Germany.
o In the same period revenues climbed by 54%, with Capital Services
accounting for a 4% share of total revenues.
o The Car Fleet Management unit acquired a fleet of 5,500 vehicles from
Hartwell Motor Contracts in the UK in the 3rd quarter. This means that
the Group now manages a vehicle fleet comprising more than 140,000
units.
JOINT VENTURE WITH DEUTSCHE TELEKOM
o The IT Services business unit increased its revenues by 10% in the 3rd
quarter, achieving a new benchmark of [EURO]842 million. After the German
Antitrust Office granted its approval, Deutsche Telekom obtained a 50.1%
stake in debis Systemhaus by means of a capital increase effective
October 1, 2000. The joint venture is progressing as planned.
OUTLOOK
o In the Financial Services business we expect an additional significant
increase in revenues during the rest of the year. The division will
utilize further growth potential by carefully expanding its range of
automotive services. The pressure on used-vehicle prices in the US will
also continue to have an impact on earnings in the 4th quarter.
<TABLE>
<CAPTION>
Amounts in millions Q1-3 00 Q1-3 00 Q1-3 99 % change
US $ [EURO] [EURO]
----------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Operating Profit (8) (9) 1,872 .
Operating Profit adjusted 433 490 730 (33)
Revenues 11,812 13,367 9,172 +46
Contract Volume 113,430 128,358 87,921 +46
New Business 38,659 43,747 34,863 +25
Employees (Sep. 30) 30,933 25,136 +23
----------------------------------------------------------------------------
</TABLE>
9
<PAGE>
AEROSPACE
o INITIAL PUBLIC OFFERING BY EADS ON JULY 10, 2000
o HIGH INCOMING ORDERS AT EADS
o AERO ENGINES EXPANDS IN THE MAINTENANCE BUSINESS
<TABLE>
<CAPTION>
Amounts in millions Q3 00 Q3 00 Q3 99 % change
US $ [EURO] [EURO]
------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Operating Profit 2,967 3,357 185 .
Operating Profit adjusted 78 88 185 (52)
Revenues (1) 443 501 2,105 (76)
Employees (Sep. 30) (1) 7,073 46,159 (85)
------------------------------------------------------------------------
</TABLE>
(1) In Q3 2000 only Aero Engines.
SEVERAL IMPORTANT ORDERS FOR EADS
o The initial public offering of stock in the new European Aeronautic
Defence and Space Company (EADS) took place on July 10, 2000. For this
reason Dasa is no longer consolidated by the DaimlerChrysler Group (with
effect from July 1), but our stake in EADS (approximately 30%) is shown
in the balance sheet at equity value. However, the Aero Engines business
unit is not a part of EADS and is still fully consolidated.
o EADS received some important orders in the 3rd quarter. The EADS Defense
Systems business unit obtained an important order from the US Navy to
equip aircraft with radar systems components. In addition, Germany,
Belgium, France, the UK, Italy, Spain and Turkey have committed
themselves to ordering a total of 225 A400M military transport aircraft.
o Initial series production of the Eurofighter is progressing well. The
first Eurofighter from the series production will perform its maiden
flight in the 3rd quarter of 2001.
o Airbus had a new record order backlog of more than 1,500 aircraft at the
end of the 3rd quarter of 2000.
AERO ENGINES' EXPANSION STRATEGY
o The Aero Engines business unit increased its revenues by 19% through
expansion in the areas of commercial aircraft engines, spare parts and
maintenance. Incoming orders rose even faster than revenues at a rate of
35%.
o In the context of the expansion strategy in the area of maintenance, MTU
Maintenance do Brasil and MTU Maintenance Zhuhai, China were
established, the latter as a joint venture with China Southern Airlines.
OUTLOOK
o For the full year we also expect revenues and incoming orders in the
Aero Engines business unit to be significantly higher than last year's
levels.
o For EADS we anticipate a further increase in incoming orders, especially
for commercial aircraft. After the positive market reaction, the A3XX
launch decision is expected for the beginning of next year.
<TABLE>
<CAPTION>
Amounts in millions Q1-3 00 Q1-3 00 Q1-3 99 % change
US $ [EURO] [EURO]
-----------------------------------------------------------------------
<S> <C> <C> <C> <C>
Operating Profit 3,286 3,719 467 .
Operating Profit adjusted 398 450 467 (4)
Revenues (1) 4,251 4,811 6,343 (24)
Employees (Sep. 30) (1) 7,073 46,159 (85)
-----------------------------------------------------------------------
</TABLE>
(1) In Q1-2 2000 division Aerospace, in Q3 2000 only Aero Engines.
10
<PAGE>
OTHER INDUSTRIAL BUSINESSES
RAIL SYSTEMS
<TABLE>
<CAPTION>
Q3 00 Q3 00 Q3 99
Amounts in millions US $ [EURO] [EURO] % change
------------------------------------------------------------------
<S> <C> <C> <C> <C>
Revenues 853 965 845 +14
Incoming Orders 617 698 629 +11
Employees (Sep. 30) 21,743 23,621 (8)
------------------------------------------------------------------
</TABLE>
GROWTH IN REVENUES AND INCOMING ORDERS
o In the 3rd quarter, Adtranz increased its revenues by 14% to [EURO]1.0
billion. Incoming orders also rose by 11% to [EURO]0.7 billion.
o The sale of Adtranz to Bombardier is still being reviewed by international
antitrust authorities. Our overall restructuring measures in this area are
continuing according to plan and making good progress.
<TABLE>
<CAPTION>
Q1-3 00 Q1-3 00 Q1-3 99
Amounts in millions US $ [EURO] [EURO] % change
------------------------------------------------------------------
<S> <C> <C> <C> <C>
Revenues 2,428 2,747 2,366 +16
Incoming Orders 2,288 2,589 2,132 +21
Employees (Sep. 30) 21,743 23,621 (8)
------------------------------------------------------------------
</TABLE>
AUTOMOTIVE ELECTRONICS
<TABLE>
<CAPTION>
Q3 00 Q3 00 Q3 99
Amounts in millions US $ [EURO] [EURO] % change
--------------------------------------------------------------
<S> <C> <C> <C> <C>
Revenues 229 259 209 +24
Incoming Orders 248 281 230 +22
Employees (Sep. 30) 5,805 4,937 +18
--------------------------------------------------------------
</TABLE>
STRONG INCREASES IN REVENUES AND INCOMING ORDERS
o TEMIC, the Automotive Electronics business unit, continued its positive
business trend in the 3rd quarter. With revenue growth of 24% to [EURO]259
million, TEMIC again expanded considerably faster than the market as a
whole.
o For the full year, TEMIC expects an increase in revenues to more than
[EURO]1 billion. Incoming orders are also planned to be substantially higher
than in the previous year.
<TABLE>
<CAPTION>
Q1-3 00 Q1-3 00 Q1-3 99
Amounts in millions US $ [EURO] [EURO] % change
---------------------------------------------------------------
<S> <C> <C> <C> <C>
Revenues 685 775 656 +18
Incoming Orders 794 899 800 +12
Employees (Sep. 30) 5,805 4,937 +18
---------------------------------------------------------------
</TABLE>
MTU/DIESEL ENGINES
<TABLE>
<CAPTION>
Q3 00 Q3 00 Q3 99
Amounts in millions US $ [EURO] [EURO] % change
--------------------------------------------------------------
<S> <C> <C> <C> <C>
Revenues 217 246 211 +17
Incoming Orders 279 316 240 +32
Employees (Sep. 30) 5,986 5,932 +1
--------------------------------------------------------------
</TABLE>
POSITIVE BUSINESS TREND
o Based largely on the success of the 2000 and 4000 engine series, the
MTU/Diesel Engines business unit increased its revenues by 17% to [EURO]246
million in the 3rd quarter.
o For the full year, the MTU/Diesel Engines business unit expects a further
rise in revenues and incoming orders.
<TABLE>
<CAPTION>
Q1-3 00 Q1-3 00 Q1-3 99
Amounts in millions US $ [EURO] [EURO] % change
---------------------------------------------------------------
<S> <C> <C> <C> <C>
Revenues 548 620 581 +7
Incoming Orders 817 925 642 +44
Employees (Sep. 30) 5,986 5,932 +1
---------------------------------------------------------------
</TABLE>
11
<PAGE>
ANALYSIS OF THE FINANCIAL SITUATION
o 3RD QUARTER OPERATING PROFIT AND NET INCOME INFLUENCED BY
ONE-TIME ITEMS
o PROFIT CONTRIBUTIONS FROM CHRYSLER GROUP AND SERVICES
NEGATIVELY AFFECTED BY INTENSE COMPETITION IN NORTH AMERICA
OPERATING PROFIT BY SEGMENT
<TABLE>
<CAPTION>
Q3 00 Q3 00 Q3 99 Q1-3 00 Q1-3 00 Q1-3 99
IN MILLIONS US $ [EURO] [EURO] US $ [EURO] [EURO]
--------------------------------------------------------------------------- -------------------------------
<S> <C> <C> <C> <C> <C> <C>
Mercedes-Benz Passenger Cars & smart 721 816 708 1,909 2,160 1,855
Chrysler Group (512) (579) 1,025 1,712 1,937 3,803
Commercial Vehicles 256 290 303 809 915 805
Services (375) (424) 1,167 (8) (9) 1,872
Aerospace 2,967 3,357 185 3,286 3,719 467
Other 4 4 (55) (116) (131) (153)
Eliminations (2) (2) (18) (45) (51) (3)
--------------------------------------------------------------------------- -------------------------------
DAIMLERCHRYSLER GROUP 3,059 3,462 3,315 7,547 8,540 8,646
--------------------------------------------------------------------------- -------------------------------
ADJUSTED FOR ONE-TIME EFFECTS 477 540 2,568 4,965 5,618 7,643
--------------------------------------------------------------------------- -------------------------------
</TABLE>
DAIMLERCHRYSLER'S OPERATING PROFIT IN THE 3RD QUARTER INCLUDING ONE-TIME EFFECTS
INCREASED; EXCLUDING ONE-TIME EFFECTS OPERATING PROFIT DECREASED
o DaimlerChrysler's 3rd quarter operating profit of [EURO]3.5 billion was
significantly affected by one-time items. Earnings particularly benefited
from the extraordinary gain ([EURO]3.3 billion) that resulted from the
exchange of shares of DaimlerChrysler Aerospace for shares of EADS, in
connection with the initial public offering of EADS, and the gain that
resulted from the capital increase at Ballard ([EURO]0.1 billion). However,
earnings were reduced by the impairment charge recorded for the residual
values of leased vehicles ([EURO]0.5 billion), a result of the intensified
competition and the price decreases for used vehicles, particularly in the
North American market. Operating profit of [EURO]0.5 billion adjusted for
these one-time effects was distinctly below the corresponding figure in the
previous year ([EURO]2.6 billion).
o The Group's operating profit of [EURO]8.5 billion for the first nine months
of the year was slightly less than the figure for the same period of 1999
([EURO]8.6 billion). Adjusted for all one-time effects in both years,
operating profit fell from [EURO]7.6 billion to [EURO]5.6 billion.
POSITIVE OPERATING PROFIT DEVELOPMENT FOR MERCEDES-BENZ PASSENGER CARS &
SMART
o The Mercedes-Benz Passenger Cars & smart division benefited from positive
unit sales and revenue trends, driven in the 3rd quarter particularly by the
S-Class (including the CL coupe), the new C-Class, and the cdi and
convertible versions of the smart. 3rd quarter operating profit was
therefore above the high value of the prior year despite increased
expenditures in connection with the development of new products.
OPERATING RESULTS FOR THE CHRYSLER GROUP AFFECTED BY PRODUCT LAUNCHES AND
INTENSE COMPETITION
o The operating loss in the 3rd quarter of 2000 was a result of Chrysler
Group's lower factory shipments, increased investment in the development and
market launch of new models and higher sales incentives. The increase in
sales incentives was attributable to the competitive NAFTA market, interest
rate increases, and the replacement of several products in the 3rd quarter.
12
<PAGE>
RECONCILIATION TO OPERATING PROFIT
<TABLE>
<CAPTION>
Q3 00 Q3 00 Q3 99 Q1-3 00 Q1-3 00 Q1-3 99
in millions US $ [EURO] [EURO] US $ [EURO] [EURO]
----------------------------------------------------------------------------- ----------------------------
<S> <C> <C> <C> <C> <C> <C>
INCOME BEFORE FINANCIAL INCOME 208 236 2,288 4,861 5,501 7,129
+ Pension and postretirement benefit
expenses other than service cost (83) (94) 83 (165) (186) 258
+ Operating income from affiliated,
associated and related companies 88 100 (42) 118 133 2
+ Gains on disposals of businesses 2,889 3,269 886 2,889 3,269 1,142
+ Miscellaneous (43) (49) 100 (156) (177) 115
----------------------------------------------------------------------------- ----------------------------
OPERATING PROFIT 3,059 3,462 3,315 7,547 8,540 8,646
----------------------------------------------------------------------------- ----------------------------
</TABLE>
SMALL DECLINE IN OPERATING PROFIT FOR COMMERCIAL VEHICLES
o The positive effects on the earnings trend in the 3rd quarter from higher
unit sales of vans in Europe and the continued recovery of the commercial
vehicle business in Latin America could not offset the negative earnings
impact from falling unit sales of Class 8 heavy trucks in the US.
OPERATING RESULTS FOR SERVICES AFFECTED BY THE RESIDUAL VALUE IMPAIRMENT
CHARGE IN THE LEASING BUSINESS
o The strong decline in earnings over the previous year resulted from the 3rd
quarter write-down of the carrying values of leased vehicles. This
impairment charge (included as an one-time item) was a result of declining
prices for used vehicles, particularly in North America, and higher price
incentives offered on new Chrysler Group models due to the intensified
competitive situation. In addition, high pressure on margins due to intense
competition and increased refinancing costs had negative impacts on
earnings.
HIGH OPERATING PROFIT IN THE AEROSPACE DIVISION DUE TO THE ONE-TIME EFFECT
FROM THE EXCHANGE OF DASA SHARES IN CONNECTION WITH THE EADS INVESTMENT
o The large increase in operating profit of the Aerospace division was
primarily due to the extraordinary gain that resulted from the exchange of
shares of DaimlerChrysler Aerospace for shares of EADS in connection with
its initial public offering. The Group's aerospace activities, which are now
represented by the investment in EADS, were accounted for at-equity for the
first time in the 3rd quarter.
OTHER INDUSTRIAL BUSINESSES WITH CONTRASTING OPERATING PROFIT TRENDS
o The Rail Systems business unit broke even in the 3rd quarter of the year.
o In the 3rd quarter, earnings for the Automotive Electronics business unit
were below the prior year's level as a result of exchange rate effects.
o Operating profit for the MTU/Diesel Engines business unit matched the level
achieved in the 3rd quarter of last year.
NET INCOME IN THE 3RD QUARTER AND IN THE FIRST NINE MONTHS INCLUDING ONE-TIME
EFFECTS INCREASED; EXCLUDING ONE-TIME EFFECTS NET INCOME DECREASED
o Financial income in the 3rd quarter was [EURO](36) million, compared with
[EURO]46 million in the previous year. For the first nine months of the
year, financial income increased from [EURO]135 million in 1999 to [EURO]300
million in 2000.
o Income before income taxes of [EURO]0.2 billion in the 3rd quarter was
noticeably lower than the figure for the same period of last year ([EURO]2.3
billion). As a consequence, income before income taxes for the first nine
months also decreased, from [EURO]7.3 billion to [EURO]5.8 billion.
o As a result of the one-time items, 3rd quarter net income and basic earnings
per share of [EURO]3.0 billion and [EURO]3.01, respectively, were 54% higher
than the corresponding figures for the 3rd quarter of 1999 ([EURO]2.0
billion and [EURO]1.95 per share). For the nine-month period from January to
September, there was a 40% rise from [EURO]4.6 billion in 1999 to [EURO]6.5
billion in 2000 and from [EURO]4.60 per share to [EURO]6.45, respectively.
13
<PAGE>
o Adjusted for one-time effects (Q3/1999: gain on the disposal of debitel
shares and charge for future lump-sum retiree payments to DaimlerChrysler
Corporation pension recipients; Q3/2000: extraordinary income from the
exchange of DaimlerChrysler Aerospace shares for shares of EADS and the
impairment charge recorded for the residual values of leased vehicles), net
income and basic earnings per share decreased in the 3rd quarter from
[EURO]1.5 billion in 1999 to [EURO]0.3 billion in 2000 and from [EURO]1.51
to [EURO]0.33, respectively. Over the first nine months of the year,
adjusted net income and basic earnings per share amounted to [EURO]3.8
billion and [EURO]3.76, after [EURO]4.6 billion and [EURO]4.62 in the same
period of last year.
BALANCE SHEET DEVELOPMENT INFLUENCED BY EXCHANGE RATE EFFECTS AND FINANCIAL
SERVICES BUSINESS
o Total assets of [EURO]210.5 billion exceeded the figure reported at the end
of 1999 by 20%. Exchange rate effects and the growing leasing and sales
financing business continued to cause substantial increases in total assets,
despite the transfer of securities into the DaimlerChrysler Pension Trust at
the beginning of the year and the reduction of operating assets from
DaimlerChrysler Aerospace during the 3rd quarter.
o High growth rates for equipment on operating leases, net (+30%), receivables
from financial services (+42%) and financial liabilities (+37%) indicate
further expansion of the financial services business within the Group.
o Stockholders' equity of [EURO]42.5 billion was significantly higher than the
figure at the end of 1999 (+18%). This is primarily due to positive exchange
rate effects and the higher net income (including one-time effects) over the
nine-month period. The equity ratio increased from 19.3% to 20.2%; the
increase was particularly strong in the industrial business (32.0% after
27.8% at the end of last year).
CHANGES IN STATEMENT OF CASH FLOWS PRINCIPALLY EFFECTED BY FINANCIAL SERVICES
BUSINESS
o The increase in cash provided by operating activities from [EURO]13.3
billion to [EURO]14.2 billion is due to the change in working capital in the
industrial business.
o Cash used for investing activities increased to [EURO]33.0 billion compared
to [EURO]21.0 billion in the first nine months of last year. The Group used
substantial amounts of cash for net increases in receivables from financial
services, equipment on operating leases, acquisitions of businesses and
purchases of property, plant and equipment.
o Cash provided by financing activities increased by [EURO]6.1 billion to
[EURO]14.1 billion, primarily caused by the net increase in financial
liabilities from the growing leasing and sales financing business.
o Cash and cash equivalents with an original maturity of three months or less
declined from [EURO]8.8 billion to [EURO]4.6 billion in the first nine
months of the year. Although approximately [EURO]2.3 billion went to EADS in
connection with the exchange of shares of DaimlerChrysler Aerospace for
shares of EADS and approximately [EURO]1.3 billion of securities was
transferred into the DaimlerChrysler Pension Trust, total liquidity, which
also includes longer-term investments and securities, fell by only [EURO]3.4
billion ([EURO]14.8 billion compared to [EURO]18.2 billion at the end of the
previous year).
--------------------------------------------------------
THIS CONSOLIDATED INTERIM REPORT CONTAINS FORWARD-LOOKING STATEMENTS BASED ON
BELIEFS OF DAIMLERCHRYSLER MANAGEMENT. WHEN USED IN THIS REPORT, THE WORDS
"ANTICIPATE," "BELIEVE," "ESTIMATE," "EXPECT," "INTEND," "PLAN" AND "PROJECT"
ARE INTENDED TO IDENTIFY FORWARD-LOOKING STATEMENTS. SUCH STATEMENTS REFLECT THE
CURRENT VIEWS OF DAIMLERCHRYSLER WITH RESPECT TO FUTURE EVENTS AND ARE SUBJECT
TO RISKS AND UNCERTAINTIES. MANY FACTORS COULD CAUSE THE ACTUAL RESULTS TO BE
MATERIALLY DIFFERENT, INCLUDING, AMONG OTHERS, CHANGES IN GENERAL ECONOMIC AND
BUSINESS CONDITIONS, CHANGES IN CURRENCY EXCHANGE RATES AND INTEREST RATES,
INTRODUCTION OF COMPETING PRODUCTS, INCREASED COMPETITIVE PRESSURE ON THE
GENERAL LEVEL OF SALES INCENTIVES, LACK OF ACCEPTANCE OF NEW PRODUCTS OR
SERVICES, INABILITY TO MEET EFFICIENCY AND COST REDUCTION OBJECTIVES, AND
CHANGES IN BUSINESS STRATEGY. ACTUAL RESULTS MAY VARY MATERIALLY FROM THOSE
PROJECTED HERE. DAIMLERCHRYSLER DOES NOT INTEND OR ASSUME ANY OBLIGATION TO
UPDATE THESE FORWARD-LOOKING STATEMENTS.
14
<PAGE>
CONSOLIDATED STATEMENTS OF INCOME Q3 2000
<TABLE>
<CAPTION>
CONSOLIDATED INDUSTRIAL BUSINESS FINANCIAL SERVICES
-------------------------------------------------------------------------------------
Q3 2000 Q3 2000 Q3 1999 Q3 2000 Q3 1999 Q3 2000 Q3 1999
(IN MILLIONS) $ [EURO] [EURO] [EURO] [EURO] [EURO] [EURO]
-------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Revenues ................................... 32,839 37,161 36,232 33,164 33,644 3,997 2,588
Cost of sales .............................. (27,151) (30,724) (28,765) (26,603) (26,620) (4,121) (2,145)
-------------------------------------------------------------------------------
GROSS MARGIN ............................... 5,688 6,437 7,467 6,561 7,024 (124) 443
Selling, administrative and other expenses . (4,327) (4,897) (3,960) (4,546) (3,725) (351) (235)
Research and development ................... (1,331) (1,506) (1,426) (1,506) (1,426) -- --
Other income ............................... 178 202 207 161 175 41 32
-------------------------------------------------------------------------------
INCOME (LOSS) BEFORE FINANCIAL INCOME ...... 208 236 2,288 670 2,048 (434) 240
Financial income, net ...................... (32) (36) 46 (39) 44 3 2
-------------------------------------------------------------------------------
INCOME (LOSS) BEFORE INCOME TAXES .......... 176 200 2,334 631 2,092 (431) 242
Effects of changes in German tax law ....... -- -- -- -- -- -- --
Income taxes ............................... (48) (54) (905) (249) (844) 195 (61)
-------------------------------------------------------------------------------
Total income taxes ......................... (48) (54) (905) (249) (844) 195 (61)
Minority interests ......................... (22) (25) (4) (24) (4) (1) --
-------------------------------------------------------------------------------
INCOME (LOSS) BEFORE EXTRAORDINARY ITEM AND
CUMULATIVE EFFECT OF A CHANGE IN ACCOUNTING
PRINCIPLE .................................. 106 121 1,425 358 1,244 (237) 181
Extraordinary item: Gains on disposals of
businesses, net of taxes ................... 2,644 2,992 535 2,992 535 -- --
Cumulative effect of a change in accounting
principle: transition adjustment resulting
from adoption of EITF 99-20, net of taxes .. (87) (99) -- -- -- (99) --
===============================================================================
NET INCOME (LOSS) .......................... 2,663 3,014 1,960 3,350 1,779 (336) 181
===============================================================================
EARNINGS PER SHARE (IN $ AND [EURO],
RESPECTIVELY)
Basic earnings per share
Income before extraordinary item and
cumulative effect of a change in
accounting principle ..................... 0.11 0.12 1.42 -- -- -- --
Extraordinary item ....................... 2.64 2.99 0.53 -- -- -- --
Cumulative effect of a change in
accounting principle ..................... (0.09) (0.10) -- -- -- -- --
===============================================================================
Net income ................................. 2.66 3.01 1.95 -- -- -- --
===============================================================================
Diluted earnings per share
Income before extraordinary item and
cumulative effect of a change in
accounting principle ..................... 0.11 0.12 1.41 -- -- -- --
Extraordinary item ....................... 2.61 2.95 0.53 -- -- -- --
Cumulative effect of a change in
accounting principle ..................... (0.09) (0.10) -- -- -- -- --
===============================================================================
Net income ................................. 2.63 2.97 1.94 -- -- -- --
===============================================================================
</TABLE>
15
<PAGE>
CONSOLIDATED STATEMENTS OF INCOME Q1-3 2000
<TABLE>
<CAPTION>
CONSOLIDATED INDUSTRIAL BUSINESS FINANCIAL SERVICES
------------------------------------------------------------------------------------
Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3
2000 2000 1999 2000 1999 2000 1999
(IN MILLIONS) $ [EURO] [EURO] [EURO] [EURO] [EURO] [EURO]
------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Revenues ................................... 107,689 121,862 108,548 110,898 101,401 10,964 7,147
Cost of sales .............................. (86,695) (98,105) (85,035) (87,882) (79,137) (10,223) (5,898)
--------------------------------------------------------------------------------
GROSS MARGIN ............................... 20,994 23,757 23,513 23,016 22,264 741 1,249
Selling, administrative and other expenses . (12,892) (14,589) (12,891) (13,653) (12,179) (936) (712)
Research and development ................... (3,999) (4,525) (4,177) (4,525) (4,177) -- --
Other income ............................... 758 858 684 772 582 86 102
--------------------------------------------------------------------------------
INCOME (LOSS) BEFORE FINANCIAL INCOME ...... 4,861 5,501 7,129 5,610 6,490 (109) 639
Financial income, net ...................... 265 300 135 293 130 7 5
--------------------------------------------------------------------------------
INCOME (LOSS) BEFORE INCOME TAXES ......... 5,126 5,801 7,264 5,903 6,620 (102) 644
Effects of changes in German tax law ....... -- -- (597) -- (634) -- 37
Income taxes ............................... (1,958) (2,216) (2,697) (2,327) (2,515) 111 (182)
--------------------------------------------------------------------------------
Total income taxes ......................... (1,958) (2,216) (3,294) (2,327) (3,149) 111 (145)
Minority interests ......................... (20) (23) (19) (22) (17) (1) (2)
--------------------------------------------------------------------------------
INCOME BEFORE EXTRAORDINARY ITEM AND
CUMULATIVE EFFECTS OF CHANGES IN ACCOUNTING
PRINCIPLES ................................. 3,148 3,562 3,951 3,554 3,454 8 497
Extraordinary item: Gains on disposals of
businesses, net of taxes ................... 2,644 2,992 659 2,992 659 -- --
Cumulative effects of changes in accounting
principles: transition adjustments
resulting from adoption of SFAS 133 and
EITF 99-20, net of taxes ................... (77) (87) -- 10 -- (97) --
================================================================================
NET INCOME (LOSS) .......................... 5,715 6,467 4,610 6,556 4,113 (89) 497
================================================================================
EARNINGS PER SHARE (IN $ AND [EURO],
RESPECTIVELY)
Basic earnings per share
Income before extraordinary item and
cumulative effects of changes in
accounting principles .................... 3.14 3.55 3.94 -- -- -- --
Extraordinary item ....................... 2.64 2.99 0.66 -- -- -- --
Cumulative effects of changes in
accounting principles .................... (0.08) (0.09) -- -- -- -- --
================================================================================
Net income ................................. 5.70 6.45 4.60 -- -- -- --
================================================================================
Diluted earnings per share
Income before extraordinary item and
cumulative effects of changes in
accounting principles .................... 3.12 3.53 3.91 -- -- -- --
Extraordinary item ....................... 2.61 2.95 0.65 -- -- -- --
Cumulative effects of changes in
accounting principles .................... (0.08) (0.09) -- -- -- -- --
================================================================================
Net income ................................. 5.65 6.39 4.56 -- -- -- --
================================================================================
</TABLE>
16
<PAGE>
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
CONSOLIDATED INDUSTRIAL BUSINESS FINANCIAL SERVICES
---------------------------------------------------------------------------------
Sep. 30, Sep. 30, Dec. 31, Sep. 30, Dec. 31, Sep. 30, Dec. 31,
2000 2000 1999 2000 1999 2000 1999
(IN MILLIONS) $ [EURO] [EURO] [EURO] [EURO] [EURO] [EURO]
---------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
ASSETS
Intangible assets .................... 3,104 3,513 2,823 3,300 2,632 213 191
Property, plant and equipment, net ... 36,613 41,432 36,434 41,334 36,338 98 96
Investments and long-term financial
assets ............................... 7,530 8,521 3,942 7,413 3,079 1,108 863
Equipment on operating leases, net ... 31,410 35,543 27,249 5,324 3,433 30,219 23,816
---------------------------------------------------------------------------------
FIXED ASSETS ......................... 78,657 89,009 70,448 57,371 45,482 31,638 24,966
---------------------------------------------------------------------------------
Inventories .......................... 15,357 17,378 14,985 16,543 14,036 835 949
Trade receivables .................... 7,863 8,898 8,840 8,391 8,522 507 318
Receivables from financial services .. 48,526 54,912 38,735 43 38 54,869 38,697
Other receivables .................... 12,753 14,432 12,571 6,515 5,408 7,917 7,163
Securities ........................... 8,990 10,173 8,969 8,736 8,250 1,437 719
Cash and cash equivalents ............ 4,059 4,593 9,099 3,667 8,197 926 902
---------------------------------------------------------------------------------
NON-FIXED ASSETS ..................... 97,548 110,386 93,199 43,895 44,451 66,491 48,748
---------------------------------------------------------------------------------
DEFERRED TAXES ....................... 2,700 3,055 3,806 2,941 3,710 114 96
---------------------------------------------------------------------------------
PREPAID EXPENSES ..................... 7,075 8,006 7,214 7,872 7,076 134 138
=================================================================================
TOTAL ASSETS ......................... 185,980 210,456 174,667 112,079 100,719 98,377 73,948
=================================================================================
LIABILITIES AND STOCKHOLDERS' EQUITY
Capital stock ........................ 2,306 2,609 2,565
Additional paid-in capital ........... 6,438 7,285 7,329
Retained earnings .................... 24,773 28,034 23,925
Accumulated other comprehensive income 4,070 4,606 2,241
Treasury stock ....................... -- -- --
---------------------------------------------------------------------------------
STOCKHOLDERS' EQUITY ................. 37,587 42,534 36,060 35,864 30,318 6,670 5,742
---------------------------------------------------------------------------------
MINORITY INTERESTS ................... 471 533 650 518 637 15 13
---------------------------------------------------------------------------------
ACCRUED LIABILITIES .................. 32,092 36,315 37,695 35,552 37,155 763 540
---------------------------------------------------------------------------------
Financial liabilities ................ 78,139 88,422 64,488 6,428 4,400 81,994 60,088
Trade liabilities .................... 15,657 17,718 15,786 17,412 15,484 306 302
Other liabilities .................... 11,625 13,155 10,286 10,056 7,655 3,099 2,631
---------------------------------------------------------------------------------
LIABILITIES .......................... 105,421 119,295 90,560 33,896 27,539 85,399 63,021
---------------------------------------------------------------------------------
DEFERRED TAXES ....................... 5,261 5,953 5,192 747 1,227 5,206 3,965
---------------------------------------------------------------------------------
DEFERRED INCOME ...................... 5,148 5,826 4,510 5,502 3,843 324 667
---------------------------------------------------------------------------------
TOTAL LIABILITIES .................... 148,393 167,922 138,607 76,215 70,401 91,707 68,206
================================================================================
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY ............................... 185,980 210,456 174,667 112,079 100,719 98,377 73,948
================================================================================
</TABLE>
17
<PAGE>
CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
CONSOLIDATED INDUSTRIAL BUSINESS FINANCIAL SERVICES
-------------------------------------------------------------------------
Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3
2000 2000 1999 2000 1999 2000 1999
(IN MILLIONS) $ [EURO] [EURO] [EURO] [EURO] [EURO] [EURO]
-------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Net income (loss) ............................ 5,715 6,467 4,610 6,556 4,113 (89) 497
Income applicable to minority interests ...... 20 23 19 22 17 1 2
Adjustments to reconcile net income to net
cash provided by operating activities:
Gains on disposals of businesses ........... (2,633) (2,980) (1,170) (2,980) (1,170) -- --
Depreciation and amortization of equipment
on operating leases ........................ 4,151 4,697 2,382 328 216 4,369 2,166
Depreciation and amortization of fixed
assets ..................................... 4,666 5,280 4,194 5,229 4,149 51 45
Change in deferred taxes ................... 1,426 1,613 2,407 954 1,945 659 462
Change in financial instruments ............ (482) (545) 169 (541) 170 (4) (1)
(Gains) losses on disposals of fixed
assets/securities .......................... (353) (400) (210) (399) (257) (1) 47
Change in trading securities ............... 44 50 402 50 427 -- (25)
Change in accrued liabilities .............. (391) (443) 2,526 (399) 2,466 (44) 60
Changes in other operating assets and
liabilities:
- inventories, net ....................... (1,638) (1,854) (2,479) (1,751) (2,424) (103) (55)
- trade receivables ...................... (779) (881) (1,164) (897) (2,056) 16 892
- trade liabilities ...................... 1,167 1,321 805 1,331 774 (10) 31
- other assets and liabilities ........... 1,613 1,827 808 1,779 450 48 358
-------------------------------------------------------------------------
CASH PROVIDED BY OPERATING ACTIVITIES ........ 12,526 14,175 13,299 9,282 8,820 4,893 4,479
-------------------------------------------------------------------------
Purchases of fixed assets:
- Increase in equipment on operating leases (13,125) (14,852) (13,963) (3,790) (2,957) (11,062) (11,006)
- Purchases of property, plant and
equipment ............................... (6,744) (7,632) (6,005) (7,604) (5,960) (28) (45)
- Purchases of other fixed assets ......... (303) (343) (396) (310) (326) (33) (70)
Proceeds from disposals of equipment on
operating leases ............................. 5,789 6,551 4,779 3,219 2,800 3,332 1,979
Proceeds from disposals of fixed assets ...... 284 321 335 300 304 21 31
Payments for acquisitions of businesses ...... (1,604) (1,815) (876) (1,716) (761) (99) (115)
Proceeds from disposals of businesses ........ 87 98 1,294 85 1,294 13 --
Change in cash from exchange of business ..... (2,018) (2,283) -- (2,283) -- -- --
(Increase) decrease in receivables from
financial services, net ...................... (10,557) (11,946) (4,715) (204) 70 (11,742) (4,785)
Acquisitions of securities (other than
trading), net ................................ (1,674) (1,894) (913) (1,304) (851) (590) (62)
Change in other cash ......................... 706 798 (503) 557 (524) 241 21
-------------------------------------------------------------------------
CASH USED FOR INVESTING ACTIVITIES ........... (29,159) (32,997) (20,963) (13,050) (6,911) (19,947) (14,052)
-------------------------------------------------------------------------
Change in financial liabilities (including
amounts for commercial paper borrowings of
[EURO]2,394 ($2,116) and [EURO]3,319 in
2000 and 1999, respectively) ................. 14,506 16,415 10,305 1,588 809 14,827 9,496
Dividends paid (including profit transferred
from subsidiaries) ........................... (2,096) (2,372) (2,378) (2,371) (2,378) (1) --
Proceeds from issuance of capital stock
(including minority interests) ............... 76 86 75 (96) 32 182 43
Purchase of treasury stock ................... (67) (76) (29) (76) (29) -- --
-------------------------------------------------------------------------
CASH PROVIDED BY (USED FOR) FINANCING
ACTIVITIES ................................... 12,419 14,053 7,973 (955) (1,566) 15,008 9,539
-------------------------------------------------------------------------
Effect of foreign exchange rate changes on
cash and cash equivalents (maturing within 3
months) ...................................... 524 593 425 523 402 70 23
-------------------------------------------------------------------------
NET INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS (MATURING WITHIN 3 MONTHS) ....... (3,690) (4,176) 734 (4,200) 745 24 (11)
-------------------------------------------------------------------------
CASH AND CASH EQUIVALENTS (MATURING WITHIN 3
MONTHS)
AT BEGINNING OF PERIOD ..................... 7,742 8,761 6,281 7,859 5,660 902 621
=========================================================================
AT END OF PERIOD ........................... 4,052 4,585 7,015 3,659 6,405 926 610
=========================================================================
</TABLE>
18
<PAGE>
ANNUAL RESULTS PRESS CONFERENCE/
ANALYSTS' AND INVESTORS' CONFERENCE
February 26, 2001
ANNUAL MEETING
April 11, 2001
International Congress Centrum in Berlin, Germany
INTERIM REPORT Q1/2001
End of April 2001
INTERIM REPORT Q2/2001
End of July 2001
INTERIM REPORT Q3/2001
End of October 2001
INVESTOR RELATIONS
Stuttgart:
Phone (+49) 711 17 92286, 17 92261 or 17 95277
Fax (+49) 711 17 94075 or 17 94109
Auburn Hills:
Phone (+1) 248 512 2950
Fax (+1) 248 512 2912
Additional information on DaimlerChrysler
is available on the Internet at:
WWW.DAIMLERCHRYSLER.COM
This report has been printed on
environment friendly paper.
CONCEPT AND CONTENT:
DaimlerChrysler AG,
Investor Relations
19
<PAGE>
DaimlerChrysler
Stuttgart, Germany
Auburn Hills, USA
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
DaimlerChrysler AG
By: /s/ ppa. Hans-Georg Bruns
------------------------------
Name: Dr. Hans-Georg Bruns
Title: Vice President
Chief Accounting Officer
By: /s/ i.V. Robert Koethner
------------------------------
Name: Robert Koethner
Title: Director
Date: October 26, 2000
