Porsche 2006 Annual Report Download - page 22

20 Management Report
Group investment in property, plant and equipment
and intangible assets totaled 579.0 million Euro
compared to 407.4 million Euro in the previous year.
At our financial services entities, capital expenditures
on spending on leased assets amounted to 625.7
million Euro after 551.9 million Euro in the previous
year. Capital expenditures on property, plant and
equipment and intangible assets at Porsche AG
accounted for a figure of 608.1 million Euro (previous
year: 420.3 million Euro). This included various ratio-
nalization projects such as the ongoing modernization
of the IT systems, the replacement of existing assets,
and measures related to environmental protection.
A figure of 2.676 billion Euro was invested for the
step up of the equity investment in Volkswagen AG
to 30.6 percent.
Depreciation, amortization and write-downs in the
Group increased to 531.7 million Euro compared
to 488.8 million Euro the year before. The financial
services entities recorded depreciation, amortization
and write-downs of 182.9 million Euro (previous
year: 164.8 million Euro).
Mandatory Bid to Volkswagen Shareholders
After the end of the reporting year, Porsche spent a
further 7.5 million Euro in August 2007 to purchase
172,218 ordinary and 68,262 preference shares
of Volkswagen AG, which Porsche received from
Volkswagen shareholders in the course of the man-
datory bid. As required by the German legislator,
this mandatory bid became necessary after Porsche
exceeded the control threshold of 30 percent at Volks-
wagen on March 28, 2007. On April 30, Porsche
presented the bid, that had previously been cleared
for publication by the Federal Financial Supervisory
Authority (BaFin), to the Volkswagen shareholders.
The bid was limited to a period of four weeks and
ended on May 29, 2007. The Volkswagen share-
holders were offered 100.92 Euro per ordinary
share and 65.54 Euro per preference share which
corresponded to the legally prescribed minimum
price. As a result of the mandatory bid, Porsche
took over 0.06 percent of the VW ordinary shares
and voting rights and 0.06 percent of the VW pre-
ference shares and thus a share of 0.06 percent of
the share capital of Volkswagen AG.
Financial Structure: Cash Flow Increased
The extended cash flow – including changes to
other provisions – rose significantly in the course of
the reporting year. At 5.642 billion Euro, the figure
was significantly higher than that of the previous
year (2.101 billion Euro). Despite the purchase of
further shares in Volkswagen AG, net liquidity only
dropped to 283.2 million Euro (previous year:
1.881 billion Euro).
Due to the extremely high result, Group equity rose
by 4.143 billion Euro to 9.481 billion Euro.
Decision in Favor of Porsche Automobil Holding SE
Towards the end of the fiscal year, on June 26, 2007,
the extraordinary stockholders' meeting decided
that Porsche would go into the future with a new
corporate structure and changed legal form. The
stockholders unanimously voted in favor of spinning
off the operating business of Porsche AG into a
wholly owned subsidiary in accordance with the pro-
visions of the reorganization law, to conclude a con-
trol and profit and loss transfer agreement between
the holding company and the operating subsidiary
and to convert the company acting as a holding
company in a European Stock Corporation, Societas
Europaea (SE). The stockholders also passed a
resolution to name the holding company Porsche
Automobil Holding SE. The registered offices of the
company are in Stuttgart. Dr. Ing. h.c. F. Porsche AG
continues to manage the operating subsidiary.
Subsequent Events
In August 2007, a further subsidiary was founded,
Porsche Switzerland. Headquartered in Zug, from
April 2008 the company is responsible for the import
and sale of Porsche vehicles, spare parts and ac-
cessories from AMAG Automobil- und Mortoren AG.
AMAG will remain a trading partner for Porsche.
The subsidiary will initially support a network of
twelve Porsche centers and 14 services operations.
04 ⁄ 05 05 ⁄ 06 06 ⁄ 07
1,332 2,101 5,642
919 959 1,205
Capital Expenditures* and Extended Cash Flow
in million Euro (Extended Cash Flow including changes to other provisions)
Capital Expenditures
Extended Cash Flow
* without financial investment
6,000
5,000
4,000
3,000
2,000
1,000