Porsche's Net Profit Soars 52 Percent. Or More.

by Bertel Schmitt

November 8th, 2008 7:53 AM

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porsche s net profit soars 52 percent or more

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.

Bertel Schmitt

Bertel Schmitt comes back to journalism after taking a 35 year break in advertising and marketing. He ran and owned advertising agencies in Duesseldorf, Germany, and New York City. Volkswagen A.G. was Bertel's most important corporate account. Schmitt's advertising and marketing career touched many corners of the industry with a special focus on automotive products and services. Since 2004, he lives in Japan and China with his wife <a href="http://www.tomokoandbertel.com"> Tomoko </a>. Bertel Schmitt is a founding board member of the <a href="http://www.offshoresuperseries.com"> Offshore Super Series </a>, an American offshore powerboat racing organization. He is co-owner of the racing team Typhoon.

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2 of 16 comments

Kurt. on Nov 10, 2008

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!

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Njoneer on Nov 10, 2008

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.

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