Porsche warns on profits due to aluminum shortage

By Steve Goldstein

Shares of sportscar maker Porsche slumped on Tuesday after a profit warning, which the group blamed on a supply shortage of specialist aluminum alloys.

Porsche (XE:P911) is now expecting revenue between EUR39 billion ($42.4 billion) and EUR40 billion and an operating margin between 14% and 15% for the year.

Previously, the sports-car and sport-utility-vehicle maker expected sales between EUR40 billion and EUR42 billion, and an operating margin between 15% and 17%.

Analysts had expected revenue of EUR40.35 billion and a margin of 15.8%, according to Visible Alpha.

Porsche shares slumped 5%.

Porsche said the shortage is due to flooding of a European supplier, which in turn will lead to impairments in production. "These are expected to last several weeks and may possibly lead to production shutdowns of one or more vehicle series. It is to be expected that the resulting delays in the production and delivery of vehicles will not be fully compensated for in the further course of the financial year," the company said.

Constellium (CSTM) and Hindalco Industries (IN:500440) unit Novelis have each warned that Swiss sites were impacted by flooding.

Porsche had previously said first-half deliveries fell 7%, hurt by China in particular, amid weak demand in the luxury segment. Last week, it announced it was moving its Porsche Germany head, Alex Pollich, to run the China business in September, as it said its current chief there, Michael Kirsch, will take on a different role.

Porsche Automobil (XE:PAH3) directly holds 12.5% of Porsche and controls more of the sports-car maker through its 32% stake in Volkswagen (XE:VOW3), which holds 75% of Porsche.

-Steve Goldstein

This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.

(END) Dow Jones Newswires

07-23-24 0548ET

Copyright (c) 2024 Dow Jones & Company, Inc.