POAHY Porsche Automobile Holding SE (PK)

   By Max Bernhard 
 

Porsche Automobil Holding SE (PAH3.XE) on Tuesday raised its year-end dividend by nearly a third on the back of higher profit and said it bought additional shares in its major investment Volkswagen AG (VOW.XE).

Porsche said it spent about 400 million euros ($453.5 million) to bring its stake in the German auto maker to 53.1% from 52.2%. Executive Board Chairman Hans Dieter Poetsch said the company remains convinced that Volkswagen has "vast potential" to increase value for shareholders, which he said isn't reflected in Volkswagen's current valuation.

Group profit for the year increased by 6% to EUR3.5 billion, leading Porsche to raise its dividend by 26% to EUR2.21 per preference share.

Porsche said it is facing a class action-style lawsuit "in connection with expanding the investment in Volkswagen AG," with 40 plaintiffs that are asking for about EUR5.4 billion in damages.

"To judge by the way the hearing has proceeded thus far, Porsche SE sees its opinion that the lawsuits are without legal basis confirmed," it said.

The holding company said it is also facing investor lawsuits from Volkswagen's diesel-emissions scandal, with more than 200 proceedings and claims of about EUR1.1 billion.

Looking to the year ahead, Porsche said it expects 2019 group profit of between EUR3.4 billion and EUR4.4 billion and net cash of about EUR300 million to EUR800 million. The forecast is "subject to the uncertainty that continues to surround possible special effects in connection with the diesel issue," it said.

Write to Max Bernhard at max.bernhard@dowjones.com; @mxbernhard

(END) Dow Jones Newswires

March 19, 2019 06:06 ET (10:06 GMT)

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