Renowned German sports-car maker Porsche (POAHY) (POAHF) announced a group profit of €980 million ($1.01 billion) in the first six months of 2016, a big fall from the €1.65 billion profit in the first half of 2015.
"This result was significantly influenced by the profit from the investment accounted for at equity in Volkswagen," Porsche said in a statement.
It added that it still expects annual group profit of between €1.4 billion and €2.4 billion for fiscal 2016, based on the continued uncertainty surrounding exceptional costs surrounding Volkswagen's emission-testing scandal which have already led to multi-billion dollar fines and could mount further. It added that a change in Volkswagen dividend policy which might result from further legal risks could also affect future profits. Porsche owns 52.2% of Volkswagen't ordinary shares and 30.8% of its subscribed capital.
The company made provisions for the cost of litigation in the first half of €21 million, down slightly from €23 million in the first half of last year.
The report listed a string of legal issues, mainly related to either the Volkswagen diesel scandal or legacy matters outstanding from its own attempts to buy Volkswagen in 2008. Most of the latter have now been resolved, with Porsche and its previous managers found not guilty and not liable. In others, Porsche simply dismisses the cases as without merit, but is still required to list them.
Stuttgart, Germany-based Porsche said that as of June 30, 2016, it had net liquidity of €1.32 billion and that this was expected to be between €1.0 billion and €1.5 billion as of December 31, 2016, "not taking future investments into account."
Turning to earnings per share, Porsche said it had a little over 153 million shares outstanding and that earnings per share for the first half were €3.20. That compared with €5.4 per share in the first half of 2015.
Analysts do not customarily compile quarterly earnings estimates for Porsche, although the average estimate for the full year is currently for earnings per share of €7.92.
Porsche was trading in Frankfurt, late morning, Monday at €46.51, down from €46.87 per share at Friday's close.