Q1 2024 Earnings Summary
- Ferrari achieved a 74% contribution margin ex-volume, driven by a robust product mix—particularly from high-margin models like the Daytona—strong personalization (slightly above 19% of revenues from cars and spare parts), and favorable country mix, contributing to an EBIT increase of EUR 123 million on revenues up by EUR 166 million.
- 74% of new cars sold in 2023 were to existing clients, indicating strong customer loyalty and recurring sales, which supports sustained demand and revenue stability.
- Ferrari is enhancing customer relationships and increasing recurring revenues by expanding personalization options and launching initiatives like the Ferrari Approved program to strengthen the pre-owned market and keep clients within the brand ecosystem.
- Foreign exchange headwinds are expected to be negative for the rest of the year, impacting profitability due to unfavorable movements in currencies such as the Chinese yuan and the Japanese yen against the euro.
- The high margins achieved in Q1, driven by significant deliveries of the Daytona SP3, are expected to decline in subsequent quarters as the number of Daytona deliveries decreases, potentially leading to lower profitability in the remaining quarters of 2024.
- There was an issue with residual values in one country for a specific model, indicating potential challenges in maintaining residual values across the product range, which could affect customer perception and demand.
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Margin Outlook
Q: Can you explain the strong margin increase this quarter?
A: The contribution margin increased significantly due to three main factors: a favorable product mix with a higher contribution from the Daytona in Q1 than expected for the rest of the year ; strong personalization revenue, slightly above the 19% guidance for the year ; and a favorable country mix, as lower sales in China positively impacted margins. -
China Sales
Q: What's impacting your sales in China?
A: We've observed fewer orders from China, mainly due to a shift from ICE to hybrid models ; last year, we shipped more ICE cars, while this year, hybrids are sold out, impacting current sales. We deliberately aim to keep Greater China sales below 10% to allow the market to become more acquainted with our brand. -
Personalization Trends
Q: Are clients personalizing more despite higher prices?
A: Yes, even after increasing personalization prices this year, the ratio of clients opting for personalization remains strong ; clients continue to personalize their cars, indicating price increases haven't deterred them. -
12Cilindri Launch
Q: Will the new 12Cilindri models drive higher personalization?
A: We anticipate strong interest in personalization for the 12Cilindri Coupe and Spider ; clients show enthusiasm for new colors like arctic white and verde toscana, and we've priced these models higher than their predecessors at EUR 395,000 for the Coupe and EUR 435,000 for the Spider. -
Purosangue Success
Q: Will there be a successor to the Purosangue?
A: While the Purosangue has strong traction and a robust order book, we cannot comment on future successors at this time. -
Order Book Normalization
Q: What does "normalization" of the order book mean?
A: Normalization refers to the expected slight decrease in our product portfolio orders due to many models being sold out and new models like the 12Cilindri not yet added to the portfolio ; however, our order book remains strong and extends well into 2026. -
Dealer Relationships and Preowned Market
Q: How are you strengthening dealer relationships and the preowned market?
A: We're enhancing client relationships through increased personalization options and have launched the Ferrari Approved program in the USA to nurture the preowned market and keep clients within the Ferrari family. -
E-Building and Electric Vehicles
Q: When will we see output from the new e-building?
A: The e-building will be inaugurated on June 21 and will produce both hybrid and electric cars ; however, we won't deliver electric cars before our previously stated timeline. -
HP Sponsorship Impact
Q: How will the HP sponsorship affect financials?
A: The HP sponsorship will start impacting the P&L from the second quarter ; it's already largely included in our guidance for the year. -
Repeat Clients
Q: What percentage of sales are to existing clients?
A: In 2023, 74% of our new cars were sold to existing clients ; this varies by model, from 30–35% up to 80–85% repeat clients.