Porsche has boosted first-half profit more than four-fold on gains from an increased stake in Volkswagen AG.
Net income in the six months ended January 31st rose to €5.55 billion ($7.3 billion) from €1.3 billion a year earlier, the Stuttgart, Germany-based carmaker said in a statement.
Revenue declined 13 per cent to 3.04 billion euros and vehicle deliveries tumbled 27 percent to 34,266.
Porsche has been accumulating shares of VW since 2005 and owned 50.8 per cent of Europe’s biggest auto manufacturer as of January 5th. The sports-car company said business will be tough this year as the global recession and tighter credit continue to hurt auto sales, with revenue and registrations falling short of year-ago figures both in its own operations and at VW.
More than 232,000 bankers and brokers have lost their jobs in the US, the biggest market for Porsche’s models, as the crisis that started with defaults on home-mortgage loans spread across the economy.
The company halted assembly at its main Zuffenhausen plant for eight days in January and plans to suspend car-making for 19 days by August to weather the slump.
Porsche said March 25th it had reached an accord with 15 banks, including new lenders, to help refinance €10 billion of loans coming due this month.
The credit crunch meant banks took longer to agree the loan, which will come in two tranches spanning 12 months, with €6.7 billion extendable for a further year. Porsche may add an extra €2.5 billion to the facility in coming weeks.
Deliveries in Germany slid 33 per cent last month to 871, counter to a 22 per cent increase in the country’s auto market caused by incentives for buyers to scrap old vehicles in favour of newer, more fuel-efficient models.
Europe’s car market shrank 18 per cent overall.
Bloomberg