Munich - German sports car manufacturer Porsche announced a huge jump in profits for the 2007/2008 financial year on Friday as Daimler AG and BMW reported a major slump in October sales.

Group profit before taxes in the 12 months up to the end of July soared to 8.57 billion euros (11.2 billion dollars) from 5.85 billion euros the previous year, Porsche said in a statement.

The good performance was due mainly due to Porsche's involvement in Volkswagen, Europe's biggest automaker, in which it has a 42.6 per cent stake that it plans to increase to 75 per cent next year.

The group's annual surplus climbed from 4.24 billion euros to 6.39 billion euros, while sales rose slightly to 7.46 billion euros from 7.4 billion euros a year ago.

Porsche said it would increase its special dividend from 1.50 euros to 2 euros. It would also pay a dividend of 69 euro cents per ordinary share and 70 cents per preferred share.

Earlier, Daimler said sales plunged to 93,900 vehicles, an 18.1 per cent from October 2007 levels as the global economic slowdown began to bite.

Sales of its core model Mercedes-Benz were down more than 20 per cent to 80,250 vehicles, while those of the subcompact Smart were up 11.3 per cent to 11,300.

The company said the biggest declines were in Western Europe and the United States.

BMW said its sales were down 8.3 per cent in October to 113,000 cars, also compared to October 2007. In the first nine months of the year the company said it sold 1.22 million vehicles, slightly more than the same period in 2007.

Daimler and BMW have announced temporary closures of factories to save costs following a drop in orders triggered by the global credit crisis. (dpa)