[360c]

Ferrari’s Fourth-Quarter Profits Plunged

By ERIC SYLVERS
Updated Feb. 2, 2016 7:33 p.m. ET

Ferrari NV on Tuesday reported a steep drop in fourth-quarter net profit and gave a muted outlook for 2016, underlining the difficult road ahead for the super sports car maker as it looks to go it alone.

Ferrari, which was spun off from Fiat Chrysler Automobiles NV last month, said it earned a net profit of €55 million ($59.7 million) in the final three months of 2015, a drop of about a third compared with the same period the previous year. Sales fell 1% to €744 million. The numbers are slight adjustments to preliminary figures Ferrari released last week.

Highlighting Ferrari’s challenges, the stock plunged as much as 14% on the New York Stock Exchange after the release of the results. With its independence, Ferrari is navigating through uncharted territory as it has been part of Fiat Chrysler and before that Fiat SpA for 30 years. Industry watchers have wondered whether Ferrari will be able to generate the funds needed to roll out new models. Now the limited growth forecasts may lead to questions about the company’s claim that its cars, which sell on average for about €250,000, are so high-end as to be recession proof.

Brokers attributed the large drop in the share price to disappointment regarding the modest growth forecasts for this year that include a 2.9% increase in adjusted gross operating profit to €770 million compared with an analyst consensus of about €800 million. Revenue is seen rising 1.6%.

Ferrari shares have lost about a third of their value since the company’s October initial share sale price of $52. They changed hands at $35.90 in midday trading in New York.


“I don’t understand the markets. We reported our best results ever,” said Ferrari Chairman Sergio Marchionne when asked on a conference call about the stock’s reaction.

Mr. Marchionne had been counting on strong growth in China to help fuel growth in the coming years, though he dialed back expectations, saying that North America and Europe will be the growth engines going forward. Vehicle sales in greater China fell 9.6% last year, though that was partially offset by a 26% rise in the rest of Asia.

Ferrari will pay a dividend of €0.46 a share on 2015 results for a total payout of €87 million. The company said it would pay out up to 40% of future net profit in dividends in coming years. Net debt at the end of last year was €1.9 billion compared with net cash of €566 million at the end of 2014.

Mr. Marchionne once again quashed any speculation Ferrari might someday sell a sport-utility vehicle or crossover, saying “you’d have to shoot me first.”

Wall Street Journal

[mondi]

Well, they will just have to sell more carbon fibre stickers for $40k...........

[Aircon]

Sounds like a good time to buy.

[Fil-Ski]

They need to sell more red jackets and shoes.

[dodger]

Same old story, bean counters take a good thing and squeeze it till all the magic has gone.

[amgsl55]

too many tight arses painting their own stripes I think

[Fil-Ski]

“I don’t understand the markets. We reported our best results ever,”

That's a worry. Why the hell are you listed if you don't understand why your share price is getting punished.

[E7ITE]

too many tight arses painting their own stripes I think

LOOLL   

I heard a story from Ferrari Perth over the weekend:  A customer wanted TARTAN stripes and tartan something else (perhaps interior inserts).  The request was sent to Ferrari and the quote came back: "$110k"

[360c]

LOOLL   

I heard a story from Ferrari Perth over the weekend:  A customer wanted TARTAN stripes and tartan something else (perhaps interior inserts).  The request was sent to Ferrari and the quote came back: "$110k"

Persona program = think of the most ludicrous number you can, then double it. Then add dealer margin, LCT, GST & stamp duty.

[E7ITE]

Persona program = think of the most ludicrous number you can, then double it. Then add dealer margin, LCT, GST & stamp duty.

When the sales exec (whom I've known for about 9 years) told me the story, we both laughed for about 5 minutes.