Ferrari: Q2 2024 outcomes affirm robust implementation and sustained expansion. 2024 prospects adjusted upward

“We are thrilled to disclose outstanding financial outcomes during the second quarter of 2024, which once again showcase a solid execution and persistent growth. Our net revenues and profitability experienced a double-digit increase, driven by the enhancement of the product assortment and the growing demand for customizations, prompting us to enhance our guidance for 2024,” stated Benedetto Vigna, CEO of Ferrari. “The quarter was further characterized by the inauguration of our new e-building, amidst a series of events dedicated to sustainable innovation with our collaborators, and our recent triumph at the 24 Hours of Le Mans”.

Ferrari N.V. (“Ferrari” or the “Company”) today announces its consolidated preliminary outcomes⁽²⁾ for the second quarter and six months concluded on June 30, 2024.

Consignments⁽³⁾⁽⁴⁾

Consignments totaled 3,484 units in Q2 2024, marking a 2.7% rise compared to the previous year. The quarterly consignments mirrored the deliberate geographical allocations, with EMEA⁽⁴⁾ remaining largely stable, Americas⁽⁴⁾ experiencing an increase of 112 units, Mainland China, Hong Kong, and Taiwan seeing a decrease of 61 units, and Rest of APAC⁽⁴⁾ noting a rise of 24 units.

The Ferrari Purosangue, Roma Spider, and 296 GTS were instrumental in driving deliveries this quarter. Initial deliveries of the SF90 XX Stradale commenced, while the Roma and the 812 Competizione saw a decrease as they approached the end of their life cycle. Meanwhile, the SF90 Stradale and 812 GTS were phased out. Allocation of the Daytona SP3 surged compared to the previous year, in accordance with plans.

The product lineup for the quarter comprised eight internal combustion engine (ICE) models and four hybrid engine models, with the former representing 52% and the latter 48% of total consignments.

Total proceeds

Overall proceeds for Q2 2024 amounted to Euro 1,712 million, indicating a 16.2% rise or 18.9% increase at constant currency⁽¹⁾.

Revenues from Vehicles and spare parts⁽⁷⁾ reached Euro 1,474 million (up by 17.1%, or 20.2% at constant currency⁽¹⁾), attributable to a more diverse product and country mix, increased customizations, and higher volumes.

Sponsorship, commercial, and brand⁽⁸⁾ earnings climbed to Euro 168 million, noting a 13.8% increase, or 14.8% at constant currency⁽¹⁾, driven by fresh sponsorships and lifestyle initiatives.

Other⁽⁹⁾ revenues remained fairly neutral, with enhanced revenues from financial services activities being counteracted by the reduced contribution from the expired Maserati contract in 2023.

Currency fluctuations – encompassing translation and transaction impacts alongside foreign currency hedges – resulted in a net negative impact of Euro 36 million, primarily affecting the US Dollar, Japanese Yen, and Chinese Yuan.

Adjusted EBITDA⁽¹⁾ and Adjusted EBIT⁽¹⁾

Q2 2024’s Adjusted EBITDA⁽¹⁾ reached Euro 669 million, marking a 13.7% increase from the previous year, with an Adjusted EBITDA⁽¹⁾ margin of 39.1%.

Adjusted EBIT⁽¹⁾ for Q2 2024 hit Euro 511 million, reflecting a growth of 17.0% compared to the previous year, with an Adjusted EBIT⁽¹⁾ margin of 29.9%.

Volume saw a slight positive increase (Euro 10 million), aligning with the rise in consignments compared to the previous year.

The Mix / price variance exhibited a robust and positive performance (Euro 122 million), mainly driven by the diversification of the product mix, supported by the Daytona SP3 and a few sales of the 499P Modificata, increased customizations, and the positive country mix attributed to Americas.

Industrial costs / research and development expenses were relatively stable.

SG&A expenses rose (Euro 23 million), primarily due to brand investments and the ongoing development of the Company’s digital infrastructure and organization.

Other changes remained largely stable, primarily influenced by new sponsorships, partially offset by increased costs related to the improved Formula 1 in-season ranking.

Financial charges, net for the quarter nearly balanced to zero, compared to Euro 9 million in the prior year, primarily driven by a positive net foreign exchange impact and increased interest income from the Group’s cash balance.

The tax rate⁽¹⁰⁾ for the quarter stood at 19.1%, mainly reflecting the anticipated benefits from the Patent Box and tax incentives for eligible research and development expenses and investments.

Consequently, the Adjusted Net income⁽¹⁾ for the quarter amounted to Euro 413 million, showing a 23.6% increase from the prior year, and the Adjusted diluted earnings per share⁽¹⁾ for the quarter reached Euro 2.29, compared to Euro 1.83 in Q2 2023.

Industrial free cash flow⁽¹⁾ for the quarter remained strong at Euro 121 million, fueled by the increased Adjusted EBITDA⁽¹⁾, partially offset by capital expenditures⁽¹¹⁾ of Euro 268 million, net cash interests and taxes of Euro 182 million, and the rise in working capital, provisions, and other by Euro 88 million.

Net Industrial Debt⁽¹⁾ as of June 30, 2024, stood at Euro 441 million, compared to a Net Industrial Cash⁽¹⁾ position of Euro 38 million as of March 31, 2024, also reflecting a dividend payment⁽¹²⁾ of Euro 440 million and share repurchases amounting to Euro 148 million. Total available liquidity as of June 30, 2024, amounted to Euro 1,882 million (compared to Euro 1,966 million as of March 31, 2024), inclusive of undrawn committed credit lines worth Euro 550 million.

2024 guidance revised upward, predicated on the subsequent assumptions for the year:

• Favorable product and country mix, in addition to heightened customizations
• Racing activities, encompassing new sponsorships, impacted by a lower Formula 1 standing in 2023 despite an increased number of races in the 2024 schedule
• Lifestyle initiatives and corporate endorsements embraced for amplified brand exposure
• Anticipated to boost revenue while investing to expedite development
• Cost inflation expected to continue
• Ongoing brand investments and increased racing expenses
• Strong industrial free cash flow generation, partly offset by higher capital expenditures and increased tax payments



Highlights of Q2 2024:

• Ferrari announced on May 13, 2024, the issuance of unsecured debt securities in benchmark size, with the net proceeds earmarked for general corporate purposes. The Euro 500 million notes, maturing in May 2030, were priced at 99.677% of their principal amount, featuring a fixed annual coupon of 3.625%. The oversubscribed offering was listed on the Official List of Euronext Dublin and commenced trading on the regulated market of Euronext Dublin. Ferrari finalized the offering on May 21, 2024.
• The inauguration of the new e-building by Ferrari took place on June 21, 2024. This facility boasts high production flexibility, environmental focus, and the capacity to manufacture Ferrari’s upcoming vehicle range with internal combustion, hybrid, and electric powertrains. Additionally, the e-building will produce critical electrical components such as high-voltage batteries, electric motors, and axles.
• The fourth tranche of Ferrari’s multi-year share buyback program concluded on June 26, 2024. Ferrari announced plans for a fifth tranche of up to Euro 250 million, scheduled to run from July 1, 2024, until November 26, 2024.

Events Following Q2:

• Ferrari N.V. joined the cooperative compliance program with the Italian Revenue Agency, as of 2023, in accordance with Italian Legislative Decree 128/2015. This move echoes Ferrari S.p.A.’s previous adherence and strengthens the group’s collaboration with Italian tax authorities.
• During the fifth tranche of the multi-year common share repurchase program initiated on June 30, 2022, Ferrari acquired 159,077 common shares from July 1, 2024, to July 29, 2024, amounting to Euro 61.7 million. As of July 29, 2024, the company held 14,324,743 common shares in treasury, representing 5.57% of the total issued share capital, inclusive of common and special voting shares, excluding those allotted under the equity incentive plan.

SOURCE: Ferrari