Porsche is to substantially increase its shareholder dividend after posting annual pre-tax profits of
€5.85bn
(£4.1bn).
The figure more than doubles last year´s profits of €2.11bn (£1.5bn) and will lead to a dividend of €6.94 (£4.89)
per
common share
Strong demand for Porsche models and a healthy performance from Volkswagen, in which Porsche holds a 31%
stake, have driven the profits. Porsche received €702.4m (£495m) from its stake in VW this year.
But Porsche also revealed that €3.6bn (£2.5bn) of the €5.86bn profit in the year to July was from share
options, meaning it made just €1.05bn (£700m) from making cars, attracting criticism that it is behaving like a
hedge fund.
Porsche is widely expected to increase its stake in VW in January 2008 to give it overall control of the German
manufacturer which
owns Audi, Bentley, Bugatti, Lamborghini, SEAT and Skoda. Porsche currently says it plans to increase its stake in
VW
to 31% only.
The European Court of Justice recently ruled that the so-called "Volkswagen Law" that protects VW from
takeovers was illegal, paving the way for a Porsche takeover.
The waters are muddied by Audi, which is increasingly manoevring to take on Porsche as a competitor in the
sports car arena,
and the prospect of strict EU targets on carbon emissions by 2015.
Taking over Volkswagen will allow Porsche
to
bring down its average emissions by off-setting high levels of CO2 from Porsche vehicles with low-CO2 models
from VW, SEAT and Skoda.