By Miranda Murray and Nick Carey
BERLIN (Reuters) - Daimler Truck on Friday raised its dividend after posting better-than-expected pre-tax 2023 earnings, sending its shares up 13% as it predicted 2024 earnings well above analyst forecasts.
The German truck maker proposed a dividend of 1.9 euros ($2.06) per share for 2023, up from 1.3 euros a year earlier.
Daimler Truck joins a number of automakers over the last few weeks that have raised their dividends or rolled out share buybacks to give cash back to investors.
It reported earnings before income tax (EBIT) of 5.5 billion euros for 2023, up 38% from 4 billion euros a year earlier. Analysts had expected EBIT of 5.2 billion euros.
Daimler Truck said it expected revenue would be flat to slightly up in 2024 and for its earnings before income tax (EBIT) to remain flat as economic conditions remained tough.
"Due to the continued difficult economic conditions... Daimler Truck expects the key truck markets to return to normal levels in 2024," the company said in a statement.
Analysts had predicted EBIT of 4.7 billion euros for Daimler Truck for 2024.
In a client note, J.P.Morgan described the forecast as "very strong guidance for 2024".
"Overall, Daimler Trucks reported another solid year... as earnings were still supported by strong pricing power and consistent level of sales," J.P. Morgan analysts wrote.
The company said its deliveries rose 1% to 526,053 trucks and buses in 2023 with an adjusted margin of 9.9%, its highest ever and up from 7.7% the previous year.
Daimler Truck has a 2025 target of a double-digit margin.
The truck maker said it expects adjusted return on sales for its key industrial business of between 9.0% and 10.5% in 2024.
In morning trade on the Frankfurt Stock Exchange, Daimler Truck shares were up 13%.
($1 = 0.9251 euros)
(This story has been corrected to remove the reference to the share buyback program in paragraphs 1 and 2, as it had been announced previously)