20-F: Ferrari Reports Strong 2023 Results, Driven by Increased Car Shipments and Brand Strength

Ferrari's 2023 annual report reveals robust financial performance, highlighting increased car shipments and the enduring strength of the Ferrari brand.

Summary

• Ferrari's 2023 annual report showcases strong financial results, driven by increased car shipments and brand strength.
• The company shipped 13,663 cars in 2023, generating net revenues of 5,970 million, an operating profit (EBIT) of 1,617 million, and a net profit of 1,257 million.
• EBITDA reached 2,279 million.
• The report details the company's strategic focus on maintaining brand exclusivity while expanding its product portfolio and targeting new customer segments.
• Ferrari is committed to achieving carbon neutrality by 2030 and is integrating environmental and social considerations into its business objectives.
• The company faces risks related to competition, technological advancements, regulatory changes, supply chain disruptions, and global economic conditions.
• Ferrari is actively managing these risks through various strategies, including financial hedging, supply chain diversification, and cost control measures.

Sentiment

Score: 8

Explanation: The document presents a positive outlook with strong financial results and strategic initiatives, but also acknowledges potential risks and challenges.

Positives

• Strong financial performance with increased car shipments and revenues.
• Commitment to sustainability and carbon neutrality.
• Expansion of product portfolio to target new customer segments.
• Strong brand image and customer loyalty.
• Active management of financial and operational risks.

Negatives

• Exposure to competition in the luxury performance car market.
• Risks associated with technological advancements and regulatory changes.
• Potential for supply chain disruptions and increased costs.
• Dependence on manufacturing facilities in Maranello and Modena.
• Volatility in demand for luxury goods.

Risks

• Inability to preserve and enhance the value of the Ferrari brand.
• Failure to attract and retain qualified personnel.
• Lack of success in racing activities.
• Inability to keep up with advances in high performance car technology.
• Impact of increasingly stringent fuel economy, emissions and safety standards.
• Increases in costs, disruptions of supply or shortages of components and raw materials.
• Inability to successfully carry out controlled growth strategy.
• Global economic conditions, macro events, pandemics and conflicts.
• Changes in client preferences and automotive trends.
• Disruptions at manufacturing facilities in Maranello and Modena.
• Climate change and other environmental impacts.
• Inability to maintain the functional and efficient operation of information technology systems and to defend from the risk of cyberattacks.
• Reliance upon a number of key members of executive management and employees.
• Performance of dealer network.
• Product warranties, product recalls and liability claims.
• Sponsorship and commercial revenues and expenses of racing activities.
• Performance of lifestyle activities.
• Inability to protect intellectual property rights and to avoid infringing on the intellectual property rights of others.
• Continued compliance with customs regulations of various jurisdictions.
• Labor relations and collective bargaining agreements.
• Inability to ensure that employees, agents and representatives comply with applicable law and regulations.
• Changes in tax, tariff or fiscal policies and regulatory, political and labor conditions in the jurisdictions in which we operate.
• Inability to service and refinance debt.
• Exchange rate fluctuations, interest rate changes, credit risk and other market risks.
• Inability to provide or arrange for adequate access to financing for dealers and clients, and associated risks.
• Adequacy of insurance coverage to protect against potential losses.
• Potential conflicts of interest due to director and officer overlaps with largest shareholders.

Future Outlook

Ferrari plans to launch 15 new models between 2023 and 2026 and aims to achieve carbon neutrality by 2030.

Industry Context

The luxury performance car market is competitive and influenced by global macroeconomic conditions, consumer spending, and technological advancements.

Comparison to Industry Standards

• Ferrari competes with other international luxury performance car manufacturers such as Lamborghini, McLaren, Aston Martin, Rolls-Royce, Bentley, Porsche, Mercedes, Audi, BMW and Land Rover.
• The company's low volume strategy differentiates it from larger automotive groups.
• Ferrari's market share in the Luxury Performance Car Industry was 25% in 2023.
• Ferrari's market share in the Enlarged Luxury Performance Car Industry was 15% in 2023.

Related Party Transactions

• The Group carries out transactions with related parties on commercial terms that are normal in the respective markets.
• Related party transactions primarily relate to the sale of engines to Maserati S.p.A., the purchase of engine components from FCA US LLC, and services provided by Stellantis Group companies.

Stakeholder Impact

• Shareholders: Tangible long-term value creation and a continuing integration of our sustainability strategy.
• Employees: A safe and eco-friendly working environment including excellent working conditions and the utmost respect for human rights and continuing professional development.
• Business Partners and Communities: Mutually beneficial relationships with business partners and the communities in which we operate.
• Environment: Mitigation of environmental impacts from our production processes and the luxury cars we produce, addressing direct and indirect GHG emissions, focusing on energy and materials, in addition to our electrification journey.

Next Steps

• Continue to launch new car models and expand sales in targeted growth regions.
• Further integrate hybrid and electric technology into car portfolio.
• Strengthen relationships with business partners and the community of Ferrari enthusiasts.
• Monitor and adapt to evolving regulatory requirements and technological changes.
• Continue to implement sustainability strategy and work towards carbon neutrality by 2030.

Key Dates

Keywords

Ferrari, financial results, car shipments, brand, luxury performance cars, EBITDA, sustainability, electric vehicles, Formula 1, risk management