Mercedes-Benz shares gained round 5% on Thursday morning after the German carmaker beat fourth-quarter earnings expectations and introduced a brand new share buyback program, regardless of warning of “distinctive” dangers within the 12 months forward.

Fourth-quarter earnings earlier than curiosity and taxation (EBIT) got here in at 4.33 billion euros ($4.7 billion), barely forward of consensus expectations, taking the full-year determine to 19.66 billion euros. Revenues rose 2% in 2023 to 153.2 billion euros from 150 billion the earlier 12 months.

The group additionally introduced an extra share buyback program price as much as 3 billion euros, with the repurchased shares subsequently canceled.

Nevertheless, Mercedes-Benz warned that provide chain bottlenecks for essential elements stay a “vital danger issue,” and mentioned an “distinctive diploma of uncertainty” surrounds geopolitical occasions and commerce coverage, significantly within the type of the Russia-Ukraine and Center East conflicts and tensions between Western powers and China.

The corporate sees flat development in 2024 as inflation and provide chain prices chunk, whereas adjusted return on gross sales for Mercedes-Benz Vehicles is anticipated to slide to a spread of 10% to 12% from 12-14% in 2023.

Automotive analysts at Jefferies mentioned in a reactive notice Thursday that though there have been no main surprises within the earnings, the money return coverage was “an indication of confidence and in line with the premium/luxurious positioning, with buyback set to maintain EPS (earnings per share) rising.”

Mercedes-Benz Chairman Ola Okayällenius informed CNBC on Thursday that the corporate was effectively positioned to beat the assorted macroeconomic headwinds.

“Immediately we’re presenting very robust numbers for Mercedes-Benz Vehicles, and actually a standout 12 months for our gentle business van division,” he mentioned.

Income at Mercedes-Benz Vans rose by 18% year-on-year to twenty.3 billion euros and adjusted EBIT surged 59% to three.1 billion euros, whereas unit gross sales climbed 8% to a report 447,800 models.

But Okayällenius famous that provide constraints did influence the corporate within the second half of 2023 and can proceed to take action within the first quarter of 2024.

“However we’re working via that with our accomplice, we are actually placing extra capability in that has been ready over the past months, so throughout this primary quarter and in direction of the top of it, I believe we could have labored via these points, in order that within the second quarter we will come again to a extra regular provide state of affairs,” he added.

Though he acknowledged that the macroeconomic surroundings was “difficult” in opposition to a backdrop of escalating battle and geopolitical tensions, together with persistent excessive rates of interest and structural financial headwinds in China, Okayällenius mentioned Mercedes wouldn’t be scaling again its investments in future improvement.

“That does not imply although that we’re retreating from anybody market, we at all times attempt to exploit the utmost potential for us within the greater than 150 nations that we’re energetic in,” he informed CNBC’s Annette Weisbach, including that the corporate was not “peeling again” its investments both.

“In actual fact, we’re truly within the highest degree of funding within the historical past of the corporate, readying an entire new technology of merchandise — a few of which will likely be launched this 12 months, however actually a product offensive particularly on the battery electrical car facet that begins in 2025, goes via 2026 and past,” Okayällenius mentioned.

“So we’re full velocity forward when it comes to growing new applied sciences, improvements and a broad set of merchandise for the years to come back.”