Ferrari: Continuous earnings growth and even more confidence in the full year guidance

Ferrari N.V. (“Ferrari” or the “Company”) today announces its consolidated preliminary results^([1]) for the third quarter and nine months ended September 30, 2024.

Shipments^([2])([3])

Shipments totaled 3,383 units in Q3 2024, down 2.2% versus the prior year. Quarterly shipments reflected the deliberate geographic allocations. In the quarter EMEA⁽⁴⁾ was up 28 units, Americas⁽⁴⁾ was down 26 units, Mainland China, Hong Kong and Taiwan decreased by 114 units and Rest of APAC⁽⁴⁾ increased by 36 units.

The Ferrari Purosangue, the Roma Spider and the 296 GTS drove deliveries in the quarter. Shipments of the SF90 XX Stradale increased and first few deliveries of the SF90 XX Spider commenced. The 812 Competizione A decreased, approaching the end of lifecycle, while the 812 Competizione and Roma phased out. The allocations of the Daytona SP3 increased versus prior year, in line with plans.

The product portfolio in the quarter included eight internal combustion engine (ICE) models and five hybrid engine models, which represented 45% and 55% of total shipments, respectively.

Total net revenues

Net revenues for Q3 2024 were Euro 1,644 million, up 6.5% or 7.0% at constant currency⁽¹⁾.

Revenues from Cars and spare parts⁽⁷⁾ were Euro 1,400 million (up 5.2% or 5.8% at constant currency⁽¹⁾), thanks to a richer product and country mix as well as increased personalizations.

Sponsorship, commercial and brand⁽⁸⁾ revenues reached Euro 174 million, up 20.4% or 20.9% at constant currency⁽¹⁾ mainly attributable to new sponsorships.

Currency – including translation and transaction impacts as well as foreign currency hedges – had a slightly negative net impact of Euro 8 million, mostly related to the US Dollar and Japanese Yen.

Adjusted EBITDA⁽¹⁾ and Adjusted EBIT⁽¹⁾

Q3 2024 Adjusted EBITDA⁽¹⁾ reached Euro 638 million, up 7.1% versus the prior year and with an Adjusted EBITDA⁽¹⁾ margin of 38.8%.

Q3 2024 Adjusted EBIT⁽¹⁾ was Euro 467 million, increased 10.3% versus the prior year and with an Adjusted EBIT⁽¹⁾ margin of 28.4%.

Volume was slightly negative (Euro 10 million), in line with the shipments decrease versus the prior year.

The Mix / price variance performance was positive (Euro 60 million), mainly reflecting the enrichment of the product mix, sustained by the Daytona SP3 and few sales of the 499P Modificata, increased personalizations and the positive country mix driven by Americas.

Industrial costs / research and development expenses decreased (Euro 11 million), primarily due to lower depreciation and amortization, in line with certain models phase out.

SG&A grew (Euro 23 million) mainly reflecting the continuous initiatives for software, digital infrastructure and organizational development, as well as brand investments.

Other changes were positive (Euro 14 million), mainly driven by the combined effect of new sponsorships and lower costs due to the revised Formula 1 in-season ranking assumptions.

Net financial charges for the quarter, were approximately Euro 1 million compared to net financial income of Euro 3 million of the prior year which also included the gain on bond cash tender realized in Q3 2023.

The tax rate⁽[1]⁾ in the quarter was 19.5%, mainly reflecting the estimate of the benefit attributable to the Patent Box and tax incentives for eligible research and development costs and investments.

As a result, the Adjusted Net profit⁽¹⁾ for the quarter was Euro 375 million, up 13.0% versus the prior year, and the Adjusted diluted earnings per share⁽¹⁾ for the quarter reached Euro 2.08, compared to Euro 1.82 in Q3 2023.

Industrial free cash flow⁽¹⁾ for the quarter was strong at Euro 364 million, driven by the increased Adjusted EBITDA⁽¹⁾ and a positive change in working capital, provisions and other for Euro 12 million, partially offset by capital expenditures^([2]) of Euro 249 million and net cash interests and taxes for Euro 27 million.

Net Industrial Debt⁽¹⁾ as of September 30, 2024 was Euro 246 million, compared to a Euro 441 million as of June 30, 2024, also reflecting the share repurchases of Euro 147 million. As of September 30, 2024, total available liquidity was Euro 2,079 million (Euro 1,882 million as of June 30, 2024), including undrawn committed credit lines of Euro 550 million.

Even more confidence in the 2024 guidance, based on the following assumptions for the year:

• Positive product and country mix, along with stronger personalizations
• Racing activities, including new sponsorships, impacted by lower Formula 1 ranking in 2023 despite higher number of races in the 2024 calendar
• Lifestyle activities expected to increase top line contribution while investing to accelerate development
• Cost inflation to persist
• Continuous brand investments and higher racing expenses
• Robust Industrial free cash flow generation, partially offset by increased capital expenditures and higher tax payment

Q3 2024 highlights:

• On September 2, 2024 Ferrari announced that, effective January 1, 2025, UniCredit S.p.A. will partner with Ferrari to be at its side in its Formula 1 racing activities under a multi-year agreement.

Subsequent Events:

• On October 1, 2024 Ferrari announced to have switched off the trigeneration plant at its Maranello factory in order to continue replacing a significant proportion of methane gas consumption with renewable energy sources, consistent with Ferrari’s decarbonization plan announced at the Capital Markets Day in 2022.
• On October 17, 2024 Ferrari unveiled the F80 and wrote a new chapter in the history of legendary supercars bearing the Prancing Horse badge. The F80 will be produced in a limited run of just 799 examples and joins the pantheon of icons such as the GTO, F40 and LaFerrari by showcasing the best that the Maranello-based marque has achieved in terms of technology and performance.
• On October 23, 2024 Ferrari announced the multi-year renewal of its partnership with Shell, effective from 1 January 2026, covering Scuderia Ferrari HP, Ferrari Hypercar and the Ferrari Challenge Series.
• Under the fifth tranche of the new multi-year common share repurchase program announced on September 30, 2022, from October 1, 2024 to November 1, 2024 the Company purchased 157,278 common shares for a total consideration of Euro 66.4 million. At November 1, 2024 the Company held in treasury an aggregate of 14,678,349 common shares equal to 5.71% 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.

[1]     These results have been prepared in accordance with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board and IFRS as endorsed by the European Union
[2]    Excluding strictly limited racing cars (such as the XX Programme and the 499P Modificata), one-off and pre-owned cars
[3]    EMEA includes: Italy, UK, Germany, Switzerland, France, Middle East (includes the United Arab Emirates, Saudi Arabia, Bahrain, Lebanon, Qatar, Oman and Kuwait), Africa and European markets not separately identified; Americas includes: United States of America, Canada, Mexico, the Caribbean and Central and South America; Rest of APAC mainly includes: Japan, Australia, Singapore, Indonesia, South Korea, Thailand, India and Malaysia
[4]    Of which 941 units in Q3 2024 (+6 units or +0.6% vs Q3 2023) and 2,613 units in 9M 2024 (+116 units or +4.6% vs 9M 2023) in the United States of America
[5]    Of which 190 units in Q3 2024 (-152 units or -44.4% vs Q3 2023) and 633 units in 9M 2024 (-296 units or -31.9% vs 9M 2023) in Mainland China
[6]        Includes net revenues generated from shipments of our cars, any personalization generated on these cars, as well as sales of spare parts
[7]         Includes net revenues earned by our racing teams (mainly in the Formula 1 World Championship and the World Endurance Championship) through sponsorship agreements and our share of the Formula 1 World Championship commercial revenues, as well as net revenues generated through the Ferrari brand, including fashion collections, merchandising, licensing and royalty income
[8]        Primarily relates to financial services activities, management of the Mugello racetrack and other sports-related activities, as well as net revenues generated from the rental of engines to other Formula 1 racing teams and from the sale of engines to Maserati. Starting from 2024, residual net revenues generated from the sale of engines are presented within other net revenues as a result of the expiration of the supply contract with Maserati in December 2023. As a result, net revenues generated from engines of Euro 28 million for the three months ended September 30, 2023 and Euro 88 million for the nine months ended September 30, 2023, that were previously presented as “Engines” net revenues, have been presented within “Other” net revenues to conform to the current presentation.
[9] The effective tax rate benefited from the coexistence of two successive Patent Box tax regimes, which provide tax benefits for companies using intangible assets. The Patent Box regime firstly introduced by the Italian Law No. 190/2014 was implemented by the Group from 2020 to 2024, recognizing the tax benefit over three annual installments. The new Patent Box regime regulated by Law Decree No. 146, effective from October 22, 2021, provides for a 110% super tax deduction for costs relating to eligible intangible assets and allows for a transitional period where both regimes coexist.
[10]   Capital expenditures excluding right-of-use assets recognized during the period in accordance with IFRS 16 – Leases
[11]   Calculated using the weighted average diluted number of common shares as of December 31, 2023 (181,511 thousand)

SOURCE: Ferrari