By on November 8, 2008

Hedge fund fornicator Luxury car maker Porsche has just announced their numbers for their last 2007/2008 fiscal. You guessed it: while the rest of the world is retching in the WC, Porsche’s profits are up a pornographic 52 percent. “The Stuttgart-based maker of the ass-engined sports car 911, IMS- challenged Boxster/Cayman and Cayenne SUV reported a net profit of nearly 6.4b Euros ($8.2b) for the year that ended July 31. That’s compared to the 4.2b Euros Porsche earned in the 2006-2007 year,” tickers The Associated Press to the world’s flabbergasted financial editors. The numbers are so mind-blowing that there are different accounts of the accounting data. The Wall Street Journal has on its wire that Porsche’s profits “soared 46% to €8.57 billion Euros, or about $10.9 billion.” (The €8.57b number is repeated by Deutsche Welle, the €6.4b figure is popular with Bloomberg. We’ll see. A few billion more or less don’t matter, we guess. Mum’s the word on Porsche’s Investors Relations page. We’ll probably have to wait until Monday, after they are done partying. Meanwhile…

Whatever the true profits may be, the boys from Zuffenhausen are a good deal closer to making more profits than sales. “Eighty percent of their profits “came not from making cars but from sophisticated financial instruments connected to a protracted takeover bid Porsche Automobil Holding SE has been pursuing for a company many times its size, Volkswagen AG,” sez the WSJ.  Wouldn’t it have been for the nasty “development costs related to its upcoming Panamera line, along with work on a hybrid drive for the Cayenne and more fuel-efficient engines,” Porsche probably would have made a profit of more than 100  percent of sales. Darn.

In tune with current couture, profit pornographer Porsche slipped into their announcement the usual language about “the current economic situation, which is extremely tense due to the U.S. mortgage crisis and the financial market crisis.” Their sales are unshattered by these seismic effects:  Porsche sales are up 1.2 percent to 98,652 units, or 1.3 percent to  €7.5b  – that according to AP.  Using the AP numbers for a minute, Porsche makes a profit of $82,390 on every car, tricking more fools to enter this business. Readers of the WSJ will think Porsche clears $110,489 on every car, prodding them into committing suicide, because they had listened to Cramer in 2006 and loaded up on GM when it was cheap.

Get the latest TTAC e-Newsletter!

Recommended

16 Comments on “Porsche’s Net Profit Soars 52 percent. Or More....”


  • avatar
    T2

    Now a “profit pornographer” might be called in while the american taxpayer is bending over to the tune of $25B but that terminology used for what is undoubtedly insider trading by Porsche is a little strong. As far as their stockholders are concerned they did good.

    I hope this was just a lapse, as this attitude is reminiscent of the so-called Japanese “Invasion” of the eighties. The underlyimg notion that there is something wrong if an outsider is successful.

    Just this morning I see another writer referring to Obama’s Environment appointee as a “Climate Czar” as if the possibility that we could be having cleaner air over america must be part of some kind of commie plot!

    C’mon Bertel, the B&B at TTac deserve better.

  • avatar

    @T2: In my book, “obscene, pornographic profits” are a terrific honorific. Producers of exquisite erotica have always been held in high esteem by this reporter.

    And it fits the brand. In the 90’s, when I helped to launch a few Porsche Centers in the Old Country, the launch events always had two groups, neatly separated: On one side were conservatively dressed gentlemen with delicate hands, in their 50’s: Surgeons usually, who had been raking it in before cost control measures were enacted.

    In the other corner were men in leather jackets, gold chains, and heavy gold Rolex watches, big breasted blondes by their sides: Pimps. If you were a successful pimp, you had to drive a Carrera.

    Both groups loved dirty jokes. Some surgeons made money supplying the blondes with bolt-ons.

    Disclaimer: This was in the 90’s , in Germany, and has no relationship whatsoever with current owners.

    PS: A Czar was what they had BEFORE the commies. First order of business of the commies was to kill the Czar, along with everybody remotely connected with him.

    PPS: My wife is Japanese. She’s standing next to me, laughing.

  • avatar

    I think we need an Energy Rasputin. :-)

    So, is Porsche the only brand shooting up. I see BMW reported a 53% drop in profits.

  • avatar

    @Stein: Rasputin is more like it. BMW doesn’t deal in derivatives. They make cars. As far as “is Porsche the only brand shooting up” goes: I hope this was just a lapse. There could be a dangerous, and surely unintended, underlying notion ….

  • avatar

    Now speaking of the Czar, I don’t understand America’s infatuation with that Czar business. We had a drug Czar, an intelligence Czar, an energy Czar, apparently a climate Czar, GM, not wating to be left behind, has Bob Lutz as a car Czar.

    The Czar was Russia’s Emperor. An autocratic, absolute ruler. The peasants were indentured slaves. The last one started a war with Japan, lost most miserably. His closest advisor was a mad monk, Rasputin, a holy man with a ravenous sexual appetite, who had to get shot and drowned for good measure. The Czar’s pasttime were pogroms. He was stupid enough to REALLY start WW I. He was killed by communists.

    And we like that?

  • avatar
    romanjetfighter

    Of course their profits are soaring.

    They charge like 7k dollars for ridiculous options like Porsche crests on the seats and 12k for brakes, etc. :X

  • avatar
    blowfish

    Perhaps King Obama should invite Porsche to run GM , Cryslur.

    GM is only days before meeting his untimely chpt 7 or 11.

  • avatar
    Qwerty

    Perhaps King Obama should invite Porsche to run GM , Cryslur.

    Perhaps even better, people can stop injecting this political bullshit into every other comment before the site this destroyed.

  • avatar

    @Bertel,

    A couple of things to keep in mind.

    1. While the numbers are mind blowing, Porsche’s fiscal year is not a calendar year. So FY 2008 (which is what is being reported) ended on July 31st, 2008.

    2. Since that time, Porsche has taken a hit, just like everyone else (but not quite as bad as some.)
    http://993c4s.com/posche-news/porsche-sales-decline-in-north-america/

    3. All the different numbers are simply a variation on what Porsche reported. The 8.6 billion Euro number is the pre-tax profit and the 6.4 bill Euro number is after-tax profit. Either way you cut it, Weideking is getting a hell of a bonus and one that is rightly deserved in my opinion.

    4. What’s of most interest to me is the fact that no one has comment on the announcement made by Porsche earlier this year http://993c4s.com/posche-news/porsche-profit-exceeds-revenue/
    where they talked about an 11 billion euro profit number. They still hit a grand-slam (thanks to some shrewd investing) but seems someone would have taken note of the 3 billion euro miss from predicted numbers.

    993C4S

  • avatar

    Thanks. I suspected it was a tax thing – the initial wire reports weren’t clear. 6.4 post after 8.6b pre should be praised as yet another accomplishment.

    Likewise right on the fiscal. Cuts both ways. The market really cratered in the past months. Which also saw the peak of Porsche’s derivatives orgy. We’ll see how that shakes out. Come next year, party may be over …

  • avatar

    I suspect we’ll see one more blip in 2009 (assuming no surprises.) Last month, when the news finally broke that Porsche had acquired options to increase their stake to almost 75%, VW shares rocketed into the stratosphere sending short sellers scurrying to find ways to cover their positions. With such a small float, Porsche was “forced” to release some of their VW shares into the market (I read numbers of as much as 5% of their holding.) This “forced” sale was at record high prices (possibly 1000 Euros or more.) This bit of trading should record a very nice profit for Porsche and be reflected in their 2009 numbers. At the very least is should help to hedge a small portion of their declining sales/revenues.

  • avatar

    Roger that. TTAC B&B have been kept abreast of these revenue-enhancing stock manipulations transactions. The WSJ had a good article yesterday, providing more detail, much way over the average piston head.

  • avatar

    @993C4S: A little fun math here. When the stock was high as a kite, VW’s market cap stood at $369,272,943,612.85 – if they sold 5% of that in options, and my calculator is still working, that’s $18463647180.64 – $18b for short. Now we don’t know what they paid for said options, and their strike price, and whether they sold right at the top, but the sheer possibilities …..

  • avatar

    Mein Gott. Das ist ein sheiss load of Geld!!! Are your numbers correct? Market cap of 369 billion!!??? Hmmm, could be more than just a bump.

  • avatar
    Kurt.

    Heil Porsche! How refreshing for a company to do what’s best…for the company! Who would have thought we’d see that in the auto industry? I bet every Porsche employee sleeps better knowing that the company is strong and can pay its promises. German (and EU) leaders must be overjoyed at the estimated 3 billion in taxes they will get from the small auto industry in Zuffenhausen. Think of how many will be funded with that kind of money – money that won’t have to come out of the “little guys” pocket. Money that can be saved so “the little guy” can …buy a PORSCHE!

  • avatar
    njoneer

    You missed the big-picture auto industry impact in Porsche’s reported profits: Porsche is the World’s Most Profitable Auto Company in spite of the auto business. The stock market game they won had nothing to do with their core business of selling sports cars.

    Every other auto company is reporting reduced sales and reduced profits. Toyota even lost money in North America for the last 2 quarters. The Truth is that the global auto industry stinks. There is no way to make money in the auto biz, except for Porsche’s leveraged takeover of VW.

Read all comments

Back to TopLeave a Reply

You must be logged in to post a comment.

Recent Comments

  • eggsalad: I had a ’13 Sonic. By 50k miles, it was using as much coolant as it was gasoline. Good riddance.
  • SCE to AUX: Well, to be distinct I guess you could repaint the Model S in a unique color, which makes the driver feel...
  • JimC2: ^^ I think @indi500fan must be talking about the Harbor Freight Turbo Encabulator.
  • SCE to AUX: Yes, a little sad. I’m no GM fan, but the Sonic sedan was a good-looking little car, and I think...
  • Yankee: Wow. So much hate on here for everyday cars! I have worked on (and owned) all kinds of cars over my 30+ years...

New Car Research

Get a Free Dealer Quote

Who We Are

  • Matthew Guy
  • Timothy Cain
  • Adam Tonge
  • Bozi Tatarevic
  • Chris Tonn
  • Corey Lewis
  • Mark Baruth
  • Ronnie Schreiber