Porsche Posts Record Profit Photo:
Steane Klose | Nov, 10 2008 | 0 Comments

Porsche's ongoing battle to take control of Volkswagen is already paying dividends for the German manufacturer as it posted a record USD$10.9 billion profit for the financial year ended July '08. That hefty sum represents a 46 percent increase on last year's results and is Porsche's highest pre-tax profit in the company's history.

The larger part of this total came from Porsche's trading in Volkswagen options, which accounted for $8.7 billion, while another $1.27 billion came from an increase in Volkswagen stock that Porsche already held. Not a bad day at the office really.

The financial (and political) manoeuvring required to increase its stake in VW has gained Porsche a lot of attention from the financial sector with the Financial Times calling Porsche a hedge fund first and an automotive manufacturer second.

Not everybody is pleased with how matters have unfolded however with allegations of price fixing being made against Porsche as it continues to gobble up VW shares and options. The call comes as Porsche predicts that Volkswagen stock will continue to rise, a move backed by the large purchase of call options (which guarantees a set price on a shares for a certain period of time), which Porsche can then make reality by purchasing further shares - thus pushing prices up.

Hmm. Fast cars and fast dealing? Interesting times we live in.

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