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Porsche AG continues strong performance

James Kon

Porsche AG continued to record strong performance in the first half of the year with the significantly increased sales revenue and operating profit in the first six months of 2022 to EUR17.92 billion and EUR3.48 billion respectively.

According to Porsche AG, the return on sales in the first half of 2022 rose to 19.4 per cent from 16.9 per cent in the previous-year period.

In the first six months of 2021, sales revenue was EUR16.53 billion and operating profit was EUR2.79 billion. This represents a growth of 8.5 per cent in revenue and 24.6 per cent in operating profit. The Stuttgart-based sports car manufacturer has therefore once again underscored its ability to operate successfully in a challenging environment.

At the same time, Porsche is pushing ahead with its strategy for a sustainable future and redefining the concept of modern luxury.

“We are proud to have made significant gains in sales revenue and earnings in this difficult market environment. It’s been a real team effort by the workforce and management,” said Deputy Chairman of the Executive Board and member of the Executive Board for Finance and IT at Porsche AG Lutz Meschke. From January to June, Porsche delivered 145,860 vehicles to customers (same period last year: 153,656).

The increase in return on sales to 19.4 per cent in the first half of the year was mainly driven by a strong product mix, currency effects and other business sectors.

Oliver Blume and Lutz Meschke from Porsche. PHOTO: PORSCHE AG

In view of the H1 2022 performance, Chairman of the Executive Board of Porsche AG Oliver Blume is optimistic about the future. “Porsche stands for sporty, modern luxury. With this, we see ourselves as well positioned in the sweet spot of the automotive industry.”

Expert studies forecast growth in luxury sports cars, fully electric vehicles and luxury SUVs in years to come. “We believe Porsche is very well positioned in each of these areas,” said Blume. “We believe we are ahead of other luxury automotive manufacturers with our strong focus on sustainability. We take a holistic view of sustainability: ecological, social and value-based. Our ambition is to be net carbon neutral in 2030.”

Automotive net cash flow in the first half of 2022 was EUR2.39 billion (previous year: EUR2.60 billion). “Despite continued robust investment in our future projects, we were again able to generate strong automotive net cash flow,” added Lutz Meschke. “We believe our cash flow focus is paying off here.”

Despite an ongoing difficult supply situation and elevated raw material and energy prices, Porsche AG is aiming for return on sales between approximately 17 and 18 per cent for the year 2022, with sales revenue of between approximately EUR38 and EUR39 billion. Over the medium term, Porsche has a return on sales target of between approximately 17 and 19 per cent.

The outlook for 2022 is based on certain assumptions, including no significant deterioration of economic conditions or the COVID-19 pandemic in Porsche’s main markets, no significant disruptions in the supply chain, especially relating to semiconductors, energy and materials parts and components, no material price increases of raw materials and no further escalation of the war in Ukraine, among others.

Porsche has the long-term ambition to achieve Group return on sales of more than 20 per cent, “The global economy is facing challenging times, but the current figures for the first half of 2022 give us confidence in our resilience,” said Lutz Meschke.