Daimler, Chrysler pay costs of split

DETROIT -- DaimlerChrysler AG and its former partner Chrysler posted weaker results in the second quarter as their trans-Atlantic union dissolved, but executives said Wednesday they're optimistic about the rest of this year despite a sales slump in the U.S. market.

DaimlerChrysler also disclosed plans for a stock buyback now that its separation from Chrysler is complete. It plans to spend about $10.2 billion buying back nearly 10 percent of its shares over the next year.

DaimlerChrysler said its profit fell 14 percent to $2.52 billion, or $2.36 per share, in the April-June period. Chrysler and its financial arm made a $549 million net profit in the second quarter but would have posted an operating loss were it not for accounting changes due to the sale of a majority stake in Chrysler to a private equity firm.

DaimlerChrysler handily beat Wall Street's expectations. Analysts surveyed by Thomson Financial had forecast earnings of $1.74 per share, while Standard & Poor's said DaimlerChrysler's results were well above its estimate of $1.55 per share.

DaimlerChrysler expects a charge of around $3.4 billion for the year from the sale of Chrysler group and its financing arm, lower than its previous estimates of $4.1 billion to $5.47 billion.