- Net revenues of Euro 1,474 million, up 14.1% versus prior year, with total shipments of 3,392 units substantially flat versus Q2 2022, in line with plans for the year
- Adjusted EBITDA of Euro 589 million, up 31.9% versus prior year
- Adjusted EBIT of Euro 437 million, up 35.4% versus prior year
- Adjusted EBITDA margin of 40.0% and Adjusted EBIT margin of 29.7% in the quarter
- Adjusted net profit of Euro 334 million and adjusted diluted EPS at Euro 1.83
- Industrial free cash flow generation of Euro 138 million
Ferrari N.V. today announces its consolidated preliminary results for the second quarter and six months ended June 30, 2023.
Shipments
Shipments totaled 3,392 units in Q2 2023, down 63 units versus the prior year, serving a very solid order book and reflecting volumes, geographic and mix allocation plans by quarter. As a result, EMEA increased by 17.3%, Americas was down 17.5%, Mainland China, Hong Kong and Taiwan was almost in line with prior year and Rest of APAC decreased by 15.6%.
Deliveries were driven by the 296 GTB, the Roma and the Portofino M, while the 296 GTS and the 812 Competizione A were in ramp up phase. In the quarter the first deliveries of the Purosangue commenced and the allocations of the Daytona SP3 continued as planned.
The product portfolio in the quarter included nine internal combustion engine (ICE) models and four hybrid engine models. Hybrid deliveries reached 43.0% of total shipments, more than doubling the prior year figure.
Net revenues for Q2 2023 were Euro 1,474 million, up 14.1% or 12.8% at constant currency.
Revenues from Cars and spare parts were Euro 1,259 million (up 14.9% or 13.5% at constant currency), thanks to a richer product mix, as well as the increased contribution from personalizations and pricing.
Sponsorship, commercial and brand revenues reached Euro 147 million, up 20.3% or 18.0% at constant currency mainly attributable to the better prior year Formula 1 ranking, new sponsorships and the contribution from lifestyle activities.
The decrease in Engines revenues (Euro 27 million, down 32.8%, also at constant currency) was attributable to lower shipments to Maserati, as the 2023 contract expiration gets closer.
Currency – including translation and transaction impacts as well as foreign currency hedges – had a positive impact of Euro 16 million, mostly related to US Dollar.
Adjusted EBITDA and Adjusted EBIT
Q2 2023 Adjusted EBITDA reached Euro 589 million, up 31.9% versus the prior year and with an Adjusted EBITDA margin of 40.0%.
Q2 2023 Adjusted EBIT was Euro 437 million, increased 35.4% versus the prior year and with an Adjusted EBIT margin of 29.7%.
Volume was flat versus the prior year, reflecting quarterly allocation plans.
The Mix / price variance performance was very strong and positive (Euro 94 million), mainly reflecting the enrichment of the product mix, sustained by the Daytona SP3, the 812 Competizione and the SF90 families, the increased contribution from personalizations and pricing.
Industrial costs / research and development expenses increased (Euro 36 million), mainly due to higher depreciation and amortization as well as raw materials cost inflation, partially contained by quarterly specific lower Formula 1 expenses, net of technology-related government incentives.
SG&A also grew (Euro 15 million) mainly reflecting the development of the Company’s digital infrastructure and its organization, as well as marketing activities.
Other changes were positive (Euro 54 million), mainly reflecting the combined effect of higher commercial revenues from a better prior year Formula 1 ranking and lower costs due to the revised Formula 1 in season ranking assumptions, new sponsorships, higher contribution from lifestyle activities as well as a partial release of car environmental provisions, as a result of more favorable market conditions.
Net financial charges in the quarter were slightly lower than the prior year, thanks to the contribution of higher interest income on liquidity partially offset by net foreign exchange impact.
The tax rate in the quarter was approximately 22%, mainly reflecting the estimate of the benefit attributable to the Patent Box, the Allowance for Corporate Equity (ACE)(10) and tax incentives for eligible research and development costs and investments.
As a result, the Adjusted Net profit for the quarter was Euro 334 million, up 33.5% versus the prior year, and the Adjusted diluted earnings per share for the quarter reached Euro 1.83, compared to Euro 1.36 in Q2 2022.
Industrial free cash flow for the quarter was solid at Euro 138 million, driven by the increased Adjusted EBITDA, partially offset by capital expenditures of Euro 198 million, the increase in working capital, provisions and other of Euro 101 million, and net cash interests and taxes for Euro 143 million paid in the quarter.
Net Industrial Debt as of June 30, 2023 was Euro 331 million, compared to Euro 53 million as of March 31, 2023, mainly reflecting the dividend payment for Euro 328 million and share repurchases of Euro 83 million. As of June 30, 2023, total available liquidity was Euro 1,710 million (Euro 2,059 million as of March 31, 2023), including undrawn committed credit lines of Euro 600 million.
2023 guidance upgraded, based on the following assumptions:
- Strong product mix and personalizations higher than initially expected
- Better revenues from racing activities
Continuing cost inflation
- Increasing depreciation and amortization in line with the start of production of new models
- Industrial free cash flow generation sustained by strong profitability, partially offset by disciplined capital expenditures and negative change in working capital
Q2 2023 highlights:
The Ferrari Purosangue triumphed in the Product Design category and the Ferrari Vision Gran Turismo triumphed Best of the Best in the Innovative Products category at the prestigious Red Dot Awards. The Ferrari Purosangue also won the Production Car category of the prestigious Car Design Award.
Ferrari donated Euro 1 million to the Emilia-Romagna Region’s Agency for Territorial Safety and Civil Protection, joining the regional fundraising campaign for the flood event that occurred in May 2023.
Ferrari won the Centenary edition of the 24 Hours of Le Mans with the 499P covering 342 laps of the French track. The Maranello manufacturer claimed an historic result on its return to the top class after half a century, with the Ferrari – AF Corse team triumphing in the world’s most famous endurance race. This was the Prancing Horse’s tenth overall victory at the 24 Hours of Le Mans, to go with those collected in 1949, 1954, 1958, and 1960-1965. Ferrari’s history at Le Mans now comprises 39 victories, including 29 class wins.
Ferrari S.p.A. was admitted to the Cooperative Compliance Regime in Italy by the Italian Revenue Agency, which provides for constant and preventive discussions between the taxpayer and the Italian tax authorities on the most significant transactions. This admission is effective as of 2022 (the year in which the application was filed), and was preceded by the adoption and validation by Italian tax authorities of an internal tax risk control system, referred to as the Tax Control Framework (TCF).
The second tranche of the multi-year share repurchase program was completed with share repurchases for a total consideration of Euro 82.8 million in the quarter. Ferrari announced its intention to continue with a third tranche of up to Euro 200 million to start on July 3, 2023 and to end no later than October 20, 2023.
Based on the SF90 Stradale, the new special limited series SF90 XX Stradale was unveiled alongside its SF90 XX Spider counterpart. To be built in just 799 and 599 examples respectively, these new V8-powered PHEVs represent the latest and most extreme example of a concept of special versions, which pushes the performance of Ferrari’s road-going models to new levels.
Subsequent Events:
On July 6, 2023 Ferrari announced a cash tender offer on the Company’s Euro 650 million principal 1.500 percent notes due May 27, 2025 (2025 Bond). On July 14, 2023, the Company accepted for purchase valid tenders of the 2025 notes for an aggregate nominal amount of Euro 199 million and at a purchase price of Euro 191 million. The repurchases were settled on July 18, 2023.
Under the third tranche of the new multi-year common share repurchase program announced on June 30, 2022, from July 3, 2023 to July 28, 2023 the Company purchased 264,792 common shares for a total consideration of Euro 76.9 million. At July 28, 2023 the Company held in treasury an aggregate of 12,820,898 common shares equal to 4.99% of the total issued share capital including the common shares and the special voting shares, net of shares assigned under the Company’s equity incentive plan.
