Porsche’s fiscal year ends on July 31st 2008 and if a report from Der Spiegel is to be believed, then it’s been a very, very good year. Unlike most other car manufacturers, Porsche is not losing money. In fact, for all intents and purposes, they might as well be printing it. You see, expected numbers are to show that Porsche’s profits actually exceeded their revenue. You read that correctly, THE AMOUNT OF PROFIT THEY WILL RECOGNIZE IS LARGER THAN THEIR REVENUE.
How can this be you ask. Quite simply, shrewd management and excellent investments. More specifically, Porsche’s 30 plus percent stake in VW accounts for more than 90% of the expected 11 billion Euro in profit (that’s $17 billion dollars at today’s conversion rate.) Revenue is expected to come in around 8.6 billion euros. For anyone that is mathematically challenged let me do the math for you: 11 billion in profit on 8.6 billion in revenue means ONE HUGE BONUS for Porsche’s management team!!!
Oh, and before I forget, Porsche would still report just shy of 10% profit or 1.2 billion euros without the VW numbers. That’s not too shabby on its own.
Wiedeking’s Payday Proportionate to Porsche’s Profit
It was reported last year that Porsche boss Wendelin Wiedeking took home almost 60 million euros for his pay package. If the numbers above are correct, some are speculating he could earn as much as 100 million euros this year. Well deserved if you ask me.
I follow a lot of internet forums with regard to Porsche. On each of these forums, any move made by the Porsche management team is scrutinized, dissected and arm-chair quarter-backed to death. It’s like each one of us (yes, I too am guilty) is smarter than the Porsche management team collectively. If these numbers are right, them my hat is off to Wiedeking and the rest of his group. No more second guessing. If anything, I’ll be working on a shrine to worship their good fortune (and yours too if you happen to be a shareholder.)
[Source: Der Spiegel, Dow Jones Newswire]