Porsche’s strategy will be pursued despite current challenging macroeconomic conditions.
Porsche AG held its virtual Annual General Meeting (AGM) on 7 June 2024. Oliver Blume, Chairman of the Executive Board, expressed satisfaction to shareholders and also explained Porsche’s current strategy.
“In 2023, Porsche impressed while realising all its ambitious forecasts. Our financial position is robust and, even in uncertain times, we remain highly profitable. At the same time, we struck an even better balance in our sales in the regions of the world,” said Oliver Blume.
“For Porsche, 2024 is a year of new product launches, with the biggest model launch programme in the company’s history. In the past months, we have launched new models for five model series. As of this year, we will have the strongest product range in the history of Porsche.”
“Having so many launches in such a short period is a complex task and a challenge for the company. We are currently gathering the momentum that will take us full speed ahead in 2025. We are laying the foundations today for our profits tomorrow – and for future dividends,” he added, making clear Porsche’s strategy to the shareholders.
During the AGM, Dr Wolfgang Porsche, Chairman of the Supervisory Board, thanked the company’s 42,000 employees.
“On behalf of the entire Supervisory Board, I want to express our special thanks and recognition. With your exceptional personal commitment and conscientiousness, you have all made a significant contribution to making the past financial year another successful one, despite all the challenges, enabling us to set new standards with our products in 2023 as well,” said Dr Porsche.
For the 2023 financial year, a dividend payment of roughly €2.1 billion was proposed by the Executive and Supervisory Boards in accordance with Porsche’s dividend policy during the AGM.
This is just under 41 percent of after-tax profit for Porsche AG, which means a dividend payout of €2.30 and €2.31 per ordinary share and preferred share respectively. In the medium term, the group intends to pay its shareholders around 50 per cent of after-tax profit.
In the 2023 financial year, the yield per ordinary share was €5.66 and the yield per preferred share was €5.67. Group sales in 2023 came to €40.5 billion, equating to an increase of 7.7 per cent over 2022’s €37.6 billion euros.
Operating profit for Porsche AG increased by 7.6 percent to €7.3 billion euros compared to 2022’s €6.8 billion. Operating return on sales remained stable at 18.0 percent despite disruptions to global supply chains and exceptionally high investments in digitalisation, product and innovation portfolio, and brand experience.
Net cash flow for automotives was €4.0 billion euros in 2023 compared to €3.9 billion in 2022.
2023 saw an increase of 3.3 percent of vehicles delivered to customers over 2022, with 320,221 Porsches landing in the hands of their clientele. The various sales regions globally also saw even more balanced sales compared to 2022.
“With the biggest model launch programme in the company’s history, Porsche has comprehensively updated the Cayenne, the Panamera, the Macan, the Taycan and the 911. With this, we’re halving the average age of our model range.”
“In technological terms, the new products are setting standards in the automotive world. We hold many trump cards in our hand – and now is the time to play them,” said Oliver Blume.
Blume also drew attention to the electrification of the 911 for 2024.
“Our long-standing bestseller will, now as an all-electric car, continue to be the highest-performance model in its segment. I am certain that this 911 will set new standards once again. It’s already clear that this high-performance hybrid technology is perfect for the 911 Carrera GTS,” he explained.
Blume also tempered optimism with a reality check of the market’s “V-curve” that accompanies every new model launch.
“With the predecessor model, we have a gradual winding down in terms of the number of units. At the same time, the new generations are introduced in stages based on markets and variants.”
“Porsche has always forged its own way – and always with our customers in mind. We face the headwinds. We go the extra mile. Even if it takes more effort. Especially because we think long term,” said Blume to reassure shareholders.
On investments into the future, Blume said, “Last year alone we invested around €5 billion in research and development and in the Porsche ecosystem – the largest amount spent in the history of our company.”
“We are resolutely advancing digitalisation in the company. To the tune of €4 billion in the coming five years, more than 350 million of which will be invested in data and artificial intelligence alone,” he added.
Porsche AG stands by its forecasts, provided that the macroeconomic circumstances do not deteriorate significantly. For the whole of 2024, the company expects a Group operating return on sales in the 15 to 17 percent range.
In the medium term, Porsche is standing by its forecast of a Group operating return on sales of around 17 to 19 percent. In the long term, the sports car manufacturer is aiming for an operating return on sales of more than 20 percent.
During the AGM, the Supervisory Board also proposed to elect all 10 current shareholder representatives for a further term.
Photo Credits: Porsche
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