Ferrari NV Earnings - Q1 2025 Analysis
Positives
- Revenues and profitability grew double digit, with shipments slightly higher than the previous year and product mix and personalizations as the main drivers of growth.
- Net profit reached €412 million and corresponded to a diluted EPS of €2.3, up 17.9% versus the prior year.
- Percentage margins strengthened in Q1 with EBITDA margin at 38.7% and EBIT margin above 30%, also benefiting from the lower D&A.
- The company delivered a strong set of financial results.
- Q1 2025 saw double-digit growth on all key metrics, led by product mix and the continued solid trend in personalizations.
Q&A Highlights - Q1 2025
Analyst asked about the differences in trends between new customers, existing customers, and top collectors, given the mixed macro picture.
The company is vigilant about the situation, but they don't see any impact on their order book or cancellation trend. They don't see any difference in trends between new clients and repeaters. They have been digging into different specific places in the world to look for a difference, but they haven't found one. They should not talk about clients in general, but rather focus on individual clients, as each one has their own specificity.
Analyst asked about the exact number of Daytonas that were produced in the quarter.
The company said that the number of Daytonas produced in the quarter is below 80. They clarified that they don't want to focus on technology, but rather on delivering emotions to their clients. They explained that they have made investments to have flexibility and the ability to maintain and offer their clients the technologies that are needed for the future.
Analyst asked about the company's guidance and the potential impact of the risk factor.
The company's guidance is maintained, but the risk factor is highlighted. The impact could be offset, but it depends on several moving parts, and the outcome is the one that has been applied.
Analyst asked about the consumer reception of the 12Cilindri and the demand consistency across geographies for that product.
The reception of the 12Cilindri has been very good across all geographies, with a higher appeal in some geographies due to lower tax rates. The company sees good traction in countries like Scandinavia, the US, Latin America, and Italy, with varying levels of demand across different regions.
Analyst asked about the profitability of Ferrari NV's non-car revenues and how they impact the company's tax rate.
The company's non-car revenues are not dilutive to profitability and are expected to have a positive impact on the company's tax rate.
Analyst asked about the demographics of Ferrari NV's Purosangue buyers, specifically the gender split and how it compares to the company's other models.
The company has seen a higher percentage of new clients for the Purosangue model, with a split of 10%. The company has also seen a higher percentage of female drivers, with the majority of buyers being couples where the male is the primary purchaser and the female is the primary driver. The company has also seen a higher percentage of buyers who drive more kilometers than other models. In terms of residual values, the company has seen a high level of traction for the Purosangue model, with some areas seeing an increase in the sticker price for pre-owned cars.
Analyst asked about the company's guidance for industrial free cash flow and the tax rate for 2025.
The company's guidance for industrial free cash flow is conservative, but it could improve over the course of the year. The tax rate is expected to be around 22% for 2025, but it could change depending on various factors.
Analyst asked about the impact of the company's sponsorship agreement on its financial performance.
The company's sponsorship agreement is not expected to have a significant impact on its financial performance, as all relevant agreements are already in place. However, the company may see a more uneven comparison with last year due to the overlap of the new and previous regimes.
Analyst asked about the company's capital expenditure guidance for 2025.
The company's capital expenditure guidance for 2025 is between €900 million and €950 million.
Analyst asked about the progress of the warranty program for hybrid customers and the assumption that the increase in net prices in the US could be worth €100 million on a consolidated basis.
Benedetto Vigna responded that the warranty program for hybrid customers is progressing well, with around 550 contracts for the hybrid warranty program. He also mentioned that the company is improving the clarity of communication regarding the warranty program. For the second question, he stated that the company has provided a level of granularity regarding the increase in net prices in the US, and that they reserve the right to intervene if necessary.
