Porsche SE
is headed for a second consecutive annual loss in the billions of euros as the hangover lingers from a failed takeover of Volkswagen AG.

The indebted automotive holding company created as a vehicle for the acquisition will stay deeply in the red as it is forced to deconsolidate its Volkswagen stake and much of its Porsche AG sports car business, officials said on Wednesday.

The complex untangling at Porsche -- now set to merge in 2011 with its 51-percent owned Volkswagen unit -- cemented its reputation as a financial black box that scarcely resembles its roots as a maker of sports cars such as the 911 Turbo.

As its debt mounted just as car markets collapsed, Porsche was forced to drop its takeover and agree a merger with Volkswagen. The first step is selling to VW a 49.9 percent stake in the Porsche AG sports car business by the end of this year.

To take into account the rather unlikely possibility that the merger does not take place after all, the parties concerned have incorporated a put/call structure into the transaction concept, said Hans Dieter Poetsch, finance chief of both Porsche SE and Volkswagen.

This includes transferring the remaining 50.1 percent of Porsche AG to Volkswagen by no later than 2014, he added.

Michael Macht, the new head of Porsche's sports cars business, promised improvement this fiscal year and forecast annual vehicle sales of 150,000 units was a realistic long-term target.

We have a fourth new model line, the Panamera, and it's doing very well so far so Porsche vehicle sales and revenue should be above those of the past fiscal year, he said, referring to the 6.6 billion euros generated from selling 75,238 units.

Macht said has Porsche received orders of between 4,000 to 5,000 for the new four-door grand tourer before it is even finished being introduced across all markets and he reaffirmed that he expected to sell 20,000 over 12 full months.

He added that Porsche AG would achieve savings in the high hundreds of millions of euros in this year and the next, and saw further advantages from synergies with Volkswagen that have not yet even been mapped out.

I think we will be able to identify as well an amount in the high hundreds of millions of euros in the next three years that both companies can then implement, he said, referring to expected cost savings and growth opportunities.

MORE ACCOUNTING LOSSES

Poetsch warned on Wednesday that the deconsolidation loss in the fiscal year to July would be triggered if VW's home state of Lower Saxony once again gets the right to appoint two members to VW's supervisory board at the next annual meeting.

According to International Financial Reporting Standards, this would mean Porsche would have to book its VW stake at market value, he told Porsche's annual news conference.

This would give rise to a considerable loss based on the current market price, Poetsch said, that would only be partially offset by the considerable deconsolidation gain from the sale of nearly half in Porsche AG.

Net of the 49.9 percent disposal, the structural changes in its consolidated statements would lead to a loss in the low single-digit billion euro range.

Porsche SE posted a group net loss of about 3.6 billion euros ($5.37 billion) for the fiscal 2008/09 year. Net debt remains at around 11.4 billion euros.

Porsche shares fell 1.3 percent by 1501 GMT while the DJ Stoxx European car sector index <.SXAP> dipped 0.8 percent.

(Editing by David Holmes and David Cowell) ($1=.6708 Euro)