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To: James Strauss who wrote (11481)	8/20/2002 12:48:39 PM
From: Bucky Katt	Read Replies (1) \| Respond to of 13094

Jim, you were right about how Europeans report numbers> Porsche Puts U.S. Listing `on Ice,' Cites SEC Law (Update5) By Bret Okeson Leipzig, Germany, Aug. 20 (Bloomberg) -- Porsche AG put plans to list shares in New York ``on ice'' because of a new U.S. rule forcing executives to swear to financial reports' accuracy. ``I take oaths seriously,'' Chief Executive Officer Wendelin Wiedeking told journalists in Leipzig, Germany, before a factory opening by the family-controlled maker of sports cars. ``You can never be sure that results which thousands of people have had a hand in preparing are completely correct.'' A law signed on July 30 by President George W. Bush requires CEOs and chief financial officers of companies with registered U.S. securities to certify financial statements. The maker of 911 and Boxster sports cars considered a New York Stock Exchange listing after Frankfurt's exchange expelled it last year from an index of mid-sized companies for refusing to publish quarterly reports. Non-U.S. companies don't have to report earnings quarterly under New York Stock Exchange rules. Analysts have said the new regulation, which carries maximum penalties of $5 million in fines and 20 years in prison, may discourage European companies from selling stock in the U.S. DaimlerChrysler AG and other German companies are seeking an exemption to the rules because German law already requires a company's supervisory board to verify the accounts. `Aggressive Rules' Porsche ``is quite conservative regarding announcements and the U.S. Securities and Exchange Commission has some aggressive rules about company reporting,'' said Henrik Lier, a WestLB Panmure analyst with a ``neutral'' rating on the stock. Wiedeking has said quarterly reports are too costly and don't accurately reflect the state of the business. The carmaker publishes financial reports twice a year. Porsche shares fell as much as 26.75 euros, or 5.4 percent, to 472.25 euros and were down 2.6 percent at 493 euros as of 6:10 p.m. Frankfurt time. The 911 car, the more expensive of Porsche's two current models, starts at about $100,000. The new plant in Leipzig will produce the Carrera GT, a $400,000 sports car which will be its fastest model, and the Cayenne, a new sport-utility vehicle expected to go on sale later this year. The carmaker has an operating profit margin, or profit before tax and interest generated from sales, of 12 percent, the highest in the auto industry. Porsche's earnings for the fiscal year ended July 31 were ``excellent,'' Wiedeking said yesterday. The carmaker's performance is ``a nice growth story,'' said Yves Vaneerdewegh, who helps to manage 500 million euros ($489 million) in equities, including Porsche shares, for Puilaetco in Brussels. Families' Holdings The Porsche and Piech families -- including Volkswagen AG Supervisory Board Chairman Ferdinand Piech, a relative of company founder Ferdinand Porsche -- own all of the carmaker's common stock and 13 percent of the preferred shares, according to Bloomberg Data. The common stock represents 50 percent of Porsche's equity and carries all the voting rights. The preferred shares represent the remainder and are publicly traded. The U.S. accounting-accuracy law takes effect Aug. 29, when the SEC must issue guidance on how to implement it. The commission said earlier this month that, for routine reporting, foreign companies will only need to certify annual accounts since they are exempt from quarterly reports. The law is intended to bolster investor confidence after some companies including Enron Corp. and WorldCom Inc. were accused of inaccurate financial reporting. As a consequence of being tossed out of Germany's MDAX index, the company sold 300 million euros worth of bonds in May through banks in Stuttgart, Germany, instead of the country's financial capital of Frankfurt, Wiedeking said. ``The Frankfurters earned nothing'' from the bond sale, said Wiedeking. ``You see, we don't forget.''