Porsche AG Reported Strong Financial Results For The First Half Of The Year

Porsche AG achieved stronger results in the second quarter of 2024 than in the previous quarter and is reporting robust financial figures for the first half-year.

However, sales revenue, operating profit, and group operating return on sales were all higher in the second quarter than they had been in the previous quarter.

The first half of 2024 brought 3.1 billion euros group operating profit, with 15.7 percent group operating return on sales. Porsche adjusts its forecast for the entire year 2024 due to a shortage of supplies that affects a number of suppliers.

From a financial standpoint, the company has also picked up speed again after a slow start to the year. In the second quarter, the group operating return on sales exceeded expectations with 17.0 percent. Consequently, despite challenging circumstances, the group operating return on sales for the first half of 2024 exceeded 15%.

Porsche’s year of product launches continues to dominate this fiscal year. The unveiling of the completely redesigned 911 in May this year marked another campaign highlight.

In just a few short months, the sports car manufacturer has updated five of its six model lines. When the full changeover is finished, the product line will be the newest it has been in years.

“The new 911 Carrera GTS is the first road-approved 911 with the super-light performance hybrid system, the technology of which was developed and tested in motorsport. The demand for this exhilarating sports car has exceeded our expectations,” says CEO Oliver Blume.

“With the largest product offensive in Porsche’s history, we are putting ourselves in pole position for this endurance race of transformation. Porsche’s innovative strength is underscored by a whole host of technological highlights that we believe will delight and inspire our customers around the world.”

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Sales and inventory levels continue to be impacted by the numerous new product introductions in the first half of the year. In addition, the modifications to the model led to a significant annual rise in sales activities and research and development costs.

Sales revenue and profits were expected to fall as a result of this. Group sales revenue reached 19.46 billion euros in the first half of 2024, up from the previous year’s total of: 20.43 billion euros). The group operating profit from sales came in at 15.7 percent (earlier year: 18.9 percent Car net income added up to 1.12 billion euros (earlier year: 2.22 billion euro

“In challenging times, we are financially robust and highly profitable. Thanks to our strategy of value-oriented sales and our well-balanced sales structure. This gives us the ability to largely absorb fluctuations in individual markets”, Lutz Meschke, Deputy Chairman of the Executive Board and Board Member for Finance and IT said.

Deliveries to customers fell by 6.8 percent to 155,945 vehicles in the first half of the year. Porsche announced a more even distribution of sales across the various sales regions.

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A significant shortage of special aluminum alloys is currently affecting a number of Porsche AG suppliers. The supply shortage is the result of the flooding of a production facility of an important European aluminium supplier who has informed its customers in writing of the occurrence of a force majeure event. Affected are lightweight body components made of aluminium, which are used in all vehicle series manufactured by Porsche.

It is becoming clear that the impending supply shortage will result in production impairments that will not be fully compensated for throughout the year, despite immediate countermeasures.

The Executive Board decided to adjust the forecast for the financial year. For the financial year 2024, the following figures are now expected:

• A return on sales between 14% and 15% (previous forecast: between 15% and 17%)

• Sales revenues between € 39 and € 40 billion (previous forecast: € 40 to 42 billion)

• An automotive net cash flow margin between 7% and 8.5% (previous forecast: between 8.5% and 10.5%)

• An automotive EBITDA margin between 23% and 24% (previous forecast: between 24% and 26%)

• An automotive BEV share between 12% and 13% (previous forecast: between 13% and 15%).

Sales revenue:

€ 19.46 billion

€ 20.43 billion

-4.8%

Operating profit:

€ 3.06 billion

€ 3.86 billion

-20.5%

Operating return on sales:

15.7% 18.9%

Deliveries to customers:

155,945 167,354 -6.8%