Porsche Automobil Holding SE (Porsche SE) has withdrawn its earnings forecast for 2024.
During the preparation of the consolidated financial statements as of December 31, 2024, an expected need for value adjustments was identified in the book values of the investments in Volkswagen AG and Porsche AG, it said in a statement on Friday evening. Accordingly, the board expects that the consolidated result after taxes will be “significantly negative” in 2024. The company had previously expected consolidated earnings after taxes of 2.4 to 4.4 billion euros. As it was said, this has no impact on the forecasts of Volkswagen AG and Porsche AG.
Porsche SE confirmed the forecast for net debt at 5.0 to 5.5 billion euros. The board of directors continues to expect a dividend to be paid out for the 2024 financial year, according to the statement.
According to Porsche SE, the expected need for value adjustments is not cash-related, but purely accounting-related. “Porsche SE remains in a very solid financial position and its financial strength remains high,” said the statement. It was also said that the entire Volkswagen Group continues to support the achievement of its strategic goals and remains convinced of the long-term potential for value growth of the core investments.
According to the further information, the background to the impairment risk is that Porsche SE cannot currently rely on the results of a current plan approved by Volkswagen AG and Porsche AG for its accounting purposes. To carry out the impairment tests for the two core investments, external analyst expectations in particular would be used to derive future cash flows.
On this basis, it is currently assumed that an unscheduled impairment of the group book value of the investment in Volkswagen AG is expected to be in the range of 7 to 20 billion euros and the group book value of the investment in Porsche AG is expected to be in the range of 1 to 2 billion euros.
The company expects that the group book values after the revaluation of the investments will continue to be significantly above the pro rata market values.
After hours, the price of the Porsche SE share temporarily fell by 2.14 percent to 35.20 euros in Tradegate trading. While Volkswagen and Porsche AG shares remain slightly positive.
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