Porsche AG laid out positive views on the luxury car sector in Wednesday’s results, reassuring investors that supply woes seen since the pandemic are now easing.
Following a 12.6% jump in sales to €30.1 billion and a 9.0% increase in operating profit to €5.5 billion over the nine months to September, Porsche backed its full-year guidance.
This was “despite a challenging situation worldwide,” the manufacturer said, hinting that high interest rates and inflation, coupled with economic concerns, had not drastically dented its performance.
Porsche did indeed raise caution on the prospect of a downturn but also highlighted softening energy and commodity prices, alongside greater availability of intermediate parts and semiconductors in the release.
Given Aston Martin Lagonda Global Holdings PLC (LSE:AML)’s own upcoming results next Wednesday, November 1, positive murmurings from Porsche on the health of the luxury car market may bode well.
Still, Aston’s ability to hold margins remains to be seen. At Porsche, returns slipped from 18.9% to 18.3%, leading to some discontent among analysts.
According to Stifel analysts, Porsche's full-year margin guidance of between 17% and 19% was slightly below expectations.
“The results mirror Volkswagen's pre-release - weaker profitability, better free cash flow,” the bank said.
That said, Aston Martin has looked to place more focus on margins than rival Porsche, selling fewer cars at a higher price, especially with the release of a new range of models.
This greater focus on price and mix over volumes should shield Aston from sacrificing margins, Deutsche Bank analysts said previously.
Aston Martin has laid out its own plans to become cash flow positive in 2024, following declining losses so far this year.
The timely shipments of its new Valkyrie and DB22 should help to do this, according to AJ Bell analyst Russ Mould. The shipments are due to have started in the latter half of the year.