STUTTGART (dpa-AFX) - After a weak start to the year, sports car manufacturer Porsche AG got back on track in the second quarter. Because more vehicles were available as part of the model launches and the sales mix improved, the Stuttgart-based company, which is majority-owned by the VW Group, was able to build up some cushion for the second half of the year, which is likely to be difficult again. Porsche CEO Oliver Blume had already lowered his forecasts earlier this week - the company is expecting production problems due to flooding at an aluminum supplier. The half-year figures presented on Wednesday only partially made up for the previous day's losses in the share price.

The share price had fallen sharply the previous day. The share price has now risen by just under 2 percent to 70.28 euros. In September 2022, the VW Group had brought the sports car manufacturer back to the stock exchange at 82.50 euros per share. This year, the DAX-listed preference share is down 14 percent for investors.

After a difficult start to the year, the operating return on sales rose to 17.0 percent in the three months from April to June. Analysts had expected less on average. In the first quarter, the margin was significantly lower because, among other things, high research and development costs were incurred and Porsche is currently launching many new models on the market, which affects sales and costs money for marketing.

In the first half of the year, the introduction of new models and weak sales in China led to further declines in business. Turnover fell by almost 5 percent to 19.5 billion euros; the operating result shrank by a good fifth to 3.06 billion euros. The operating margin thus fell by more than 3 percentage points to 15.7 percent. For the year as a whole, the management is aiming for a range of 14 to 15 percent. Net profit fell by 22 percent to 2.15 billion euros in the first six months.

The management wants to deliver better figures again in the coming years. In terms of the operating margin, Blume said in a conference call that he is confident of achieving the medium-term target range of a 17 to 19 percent margin by 2025. In view of the current challenges, the company is also continuing to work on costs in order to reach the long-term target regions of more than 20 percent, said CFO Lutz Meschke. Among other things, fewer costs would be incurred for research and development in future. This should already reduce costs in the second half of the year compared to the first.

Porsche is currently experiencing problems in China in particular, with deliveries in the People's Republic falling by a third in the first half of the year. Porsche has been pointing to a weak environment for luxury cars for some time, because the wealthy Chinese are currently being held back in their desire to buy by the real estate crisis in the country. It remains to be seen how the market for luxury cars in China will develop in general, said Blume.

The Group CEO added that the recently introduced future head of China, Alexander Pollich, should, among other things, focus on intensifying relations with Chinese dealers. Media reports had recently stated that dealers in China were disgruntled because Porsche did not want to allow any discounts in the face of tough Chinese competition. Porsche is sticking to its guns, said Blume. However, due to the sales problems, the company had decided to create compensation for the dealers linked to their performance. These payments are not to be based solely on sales volume.

Meschke announced that, in the context of the difficult market situation for electric cars as a whole, the focus would once again be on combustion engines. "As the transformation to electromobility is developing very differently around the world, we have already begun to recalibrate and prioritize projects and products with regard to combustion technology," said the CFO. The strategy includes a high degree of flexibility in the production of the various drive types. The company is not changing its fundamental strategy of an 80 percent share of sales of purely electric cars by 2030, said Blume. Porsche is ready for this, but ultimately the markets will decide.

Regarding the interest in acquiring a stake in the faltering battery company Varta, Meschke said that it was the clear intention to take over the majority of the business with Varta's electric car battery V4Drive. Porsche is installing the battery in the new 911, in which a so-called mild-hybrid drive is intended to provide more power at low engine speeds, among other things. However, a majority takeover of the battery would also require a stable situation on the owner side at Varta. The management did not disclose any further details, such as an upper limit for a financial investment./men/mne/mis