German truck maker MAN SE proposed an eightfold payout hike to shareholders like Volkswagen, much higher than expected, although it posted full-year results that fell shy of consensus. On Monday, the company also forecast profitability would rise this year by at least one percentage point over the 7.1 percent recorded for 2010.
"Following a good first few months, we expect revenue growth of between 7 and 10 percent," finance chief Frank Lutz said in a statement. Operating profit last year doubled to 1.04 billion euros ($1.5 billion), just missing the average estimate of 1.06 billion in a Reuters poll of 18 banks and brokerages. MAN proposed hiking its dividend eightfold to 2.00 euros per share, much better than the median estimate of 1.40 euros, even though net profit at 722 million euros was well below expectations.
Volkswagen Chief Executive Martin Winterkorn said earlier this month that full synergies ultimately can only be leveraged when Swedish truck maker Scania and MAN form an alliance. However, he also added that no decision had yet been made on whether this alliance would arise via a merger or a take-over.
Volkswagen is the largest shareholder in both truck makers. Last week, sources familiar with the matter told Reuters that Scania would bid for MAN, but that this would likely occur in the second half of this year at the earliest.
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