Porsche 2004 Annual Report Download - page 30

Download and view the complete annual report

Please find page 30 of the 2004 Porsche annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 168

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144
  • 145
  • 146
  • 147
  • 148
  • 149
  • 150
  • 151
  • 152
  • 153
  • 154
  • 155
  • 156
  • 157
  • 158
  • 159
  • 160
  • 161
  • 162
  • 163
  • 164
  • 165
  • 166
  • 167
  • 168

Finances/Porsche Stock26
Porsche AG’s pre-tax profit went up from 843 million Euro to 872 mil-
lion Euro; its after-tax profit improved from 488 million Euro in the
previous year to 528 million Euro.
The increase in overall unit sales also had a positive effect on Group
sales revenue, which went up by 6.9 percent to 6.574 billion Euro.
Despite this marked increase in unit sales, the cost of materials only
rose from 2.875 billion Euro in the previous year to 2.950 billion
Euro, and accounted for 44.4 percent of overall sales revenues as
opposed to 45.4 percent in the previous year. This item reflects the
changed model mix and also the success of our cautious currency
hedging policy.
Although the Porsche Group’s personnel expenses rose from 949.7
million Euro to 964.8 million Euro, the proportion of total sales fell
from 15.0 to 14.5 percent. Other operating expenses were cut from
1.221 billion Euro to 1.211 billion Euro, so that they amounted to
only 18.2 percent of total sales in the reporting year compared with
19.3 percent in the previous year.
Financial income rose to 18.8 million Euro (previous year: 16.0 mil-
lion Euro). Tax provisions of 459 million Euro represented a tax ratio
of 37.1 percent (previous year: 39.3 percent), a drop resulting from
lower rates of tax at certain subsidiaries.
Foreign currency and cash management
The foreign currencies most important to Porsche fluctuated signi-
ficantly again during the past fiscal year. In view of this situation, the
strategy of securing the currencies most important to the company
in the medium term and thus creating a stable planning platform
once again proved to be worthwhile. The currency hedging strategy
is based on analysis of the principal national economies and on tech-
nical currency and analytical models. After this, various instruments
are implemented to protect Porsche against exchange rate risks.
Hedging agreements are concluded only with banks of high standing,
so that the risk of failure is minimized. We also secure loans made to
Group companies by means of interest-rate agreements.
Currency and cash management organization is in accordance with
the standard drawn up by German industry, and is subject to strict
internal control, with directives stating the nature and extent of these
transactions and the procedures to be adopted. The basic principle
of segregation of functions is adhered to, and special data proces-
sing systems are employed for the evaluation and monitoring of all
transactions. Porsche’s investment policy complies with the basic
principle that investment security takes clear precedence over any
attempt to secure an unusually high return on investment. We there-
fore deposit our cash with banks of impeccable creditworthiness in
the form of overnight or fixed-term loans. In addition, Porsche also
invests in money-market funds and makes use of special security
investment funds when liquidity has to be deposited in the medium
or even long term.
Group Balance Sheet Structure Proportions in percent
Assets 03 ⁄ 04
26.4
6.9
32.6
34.1
25.0
5.9
31.8
37.3
32.4
40.5
27.1
35.2
35.7
29.1
Assets 04 ⁄05 Liabilities 03 ⁄04 Liabilities 04 ⁄ 05
Equity
Long-term Liabilities
Short-term Liabilities
Non-current Assets
Inventories
Trade Receivables,
Other Assets and
Prepaid Expenses
Securities and
Liquid Assets