Porsche AG reported a major increase in operating profit to 1.07 billion euros ($1.54 billion) in the first half of the year, compared to the 675 million it achieved in the same period last year. The company’s revenue for the same period increased to 5.22 billion euros, up by 19 percent.
Chief Executive Officer Matthias Mueller disclosed in a statement that the company is able to profit through a “very attractive model range” from a high demand worldwide for sports vehicles in the luxury segment.
Profit and margin both went beyond expectations, according to analyst Juergen Pieper at Bankhaus Metzler in Frankfurt. The analysts added that the company has “excellent products" with the Cayenne and Panamera.
Also, the overall environment for luxury vehicles is very solid. Lutz Meschke, the company’s chief financial officer, said that the automaker still aims for a "clearly" double-digit operating margin this 2011. In the first half last year, the company’s operating margin was 15.4 percent.
Meschke disclosed that through their cash flow, they were able to finance all investments as a result of their high profit-earning capacity and “a very healthy cost structure." Luxury and mass-market vehicle manufacturers are eyeing fast-growing markets like China to offset the slow sales improvement in Europe.
Porsche sold 11,712 vehicle units in China in the first half of the year, an increase of 47 percent from the same period last year. Meanwhile, sales in North America increased 25.1 percent in the same period this year to 15,466.
The vehicle market of China, which is the largest in the world, is forecasted to cool down this year with the rising prices of fuel and tighter rules on vehicle registration.