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Porsche SE flags smaller dividend cut on "positive" VW outlook

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Porsche SE, Volkswagen's (VW) majority shareholder, proposed on Monday a smaller dividend cut than announced last week, citing a "positive outlook" for Europe's largest automaker as it battles to overcome an emissions-test cheating scandal.

[BERLIN] Porsche SE, Volkswagen's (VW) majority shareholder, proposed on Monday a smaller dividend cut than announced last week, citing a "positive outlook" for Europe's largest automaker as it battles to overcome an emissions-test cheating scandal.

Porsche SE, the family-controlled holding company that owns 52.2 per cent of VW's common shares, said it planned to pay dividends on 2015 results of 1.004 euros per ordinary share and 1.01 euros per preference share, down from 2.004 euros and 2.01 euros respectively on 2014 results.

On Friday, the Stuttgart-based company had announced plans to slash the dividends to 0.204 euros and 0.21 euros respectively.

VW last week agreed a long-awaited deal with US authorities to buy back or potentially fix about half a million diesel vehicles affected by its emissions test cheating, and set up environmental and consumer compensation funds.

The company, which has described 2016 as "a year of transition", said on Friday it expected flat deliveries this year and forecast an operating margin of 5-6 per cent, compared with 6 per cent in 2015, adjusted for costs of the test-cheating scandal.

Setting aside 16.2 billion euros (S$24.7 billion) to help meet those costs, VW also said it expected cost cutting to support 2016 group earnings.

Porsche SE is due to publish full-year results on Friday.

REUTERS