(Reuters) -Porsche SE, the holding firm of carmaker Porsche AG, said on Thursday that it now expects impairments to nearly double to the range of 2.5 billion to 3.5 billion euros ($3.64 billion) on its stake in the carmaker, from a previous range of 1 billion to 2 billion euros.
Volkswagen’s top shareholder, Porsche SE, now expects its write down to tend towards the lower end of the range of 20 billion euros, while maintaining the previously expected range of 7 billion to 20 billion euros.
Porsche SE said that the expected impairment loss on its stake in Porsche AG will also affect its annual financial results, though to a lesser extent.
Porsche AG said in a separate statement that expenses for vehicle development and battery activities in its units will impact the company’s operating profit and automotive net cash flow by up to 800 million euros in 2025.
The German luxury carmaker said it expects 2025 sales revenue of 39 billion to 40 billion euros and automotive net cash flow margin between 7% and 9% due to the expenditures and existing market conditions.
As the carmaker struggles to boost flagging earnings and sales in China, the board seeks to expand the product portfolio to include models with combustion engines or plug-in hybrids as well as improve the Sonder- and Exklusivmanufaktur programs.
It will also make adjustments to the corporate organization, according to the statement.
On Saturday, the supervisory board of Porsche AG started talks to end finance chief Lutz Meschke’s and sales executive Detlev von Platen’s contracts early.
In October, the carmaker said it would cut costs as other top-end German carmakers took a battering at home and in China in 2024, sales volume data showed, as wealthier consumers held back on purchases amid an uncertain economy and slower-than-expected electric vehicle sales.
($1 = 0.9628 euros)
(Reporting by Urvi Dugar; Editing by Alan Barona)
