Ferrari applies brakes on outlook
Ferrari has cut its long-term profit goal a month after the CEO called the targets of previous management “aspirational”.
Ferrari has cut its long-term profit goal a month after the CEO called the targets of previous management “aspirational”.
Ferrari now expects earnings before interest, tax, depreciation and amortisation to be in a range of €1.8bn-€2bn in 2022, down from the old target of €2bn, Louis Camilleri told investors.
The revision casts a pall over an otherwise upbeat presentation, which included a slew of new cars and a focus on hybrid engines. The cut shows the pressure facing Camilleri, who took over from long-term predecessor Sergio Marchionne in July, just days before the legendary Fiat and Ferrari boss suddenly passed away.
The stock fell as much as 3.7% in Milan before making up most of the decline after Ferrari raised its dividend and announced a €1.5bn share buyback plan. The shares were down 0.5% at 1pm.
Ferrari has gained about a third in 2018, which makes it the second-best performer in the Stoxx 600 automobiles & parts index in 2018, behind Peugeot.
FERRARI WILL START SELLING AN SUV CALLED THE PUROSANGUE — OR THOROUGHBRED — BY 2022
The profit goal is “ambitious but doable”, Camilleri said, as he unveiled plans to add electric power to more than half Ferrari’s line-up. The company will make its first sport utility vehicle (SUV), highlighting how even a manufacturer long synonymous with high-performance petrol cars is going with the times to meet its growth targets.
About 60% of total production will have a hybrid engine by 2022 and Ferrari will start selling an SUV called the Purosangue — or thoroughbred — by then, the company said as it briefed investors on its five-year development plan.
For purist Ferrari fans worried about that new direction, there was also a taste of what Ferrari does best: the carbonfibre, 810-horsepower Monza charged with a V-12 engine in one-seat and two-seat versions.
Camilleri, who took over from Marchionne in July, has a lot riding on the broader portfolio. He inherited a target from his predecessor of doubling profit to €2bn by 2022.
While the Monza is part of an ultra-rare, ultra-expensive crop of special editions, it is a niche that is important for carmakers like Ferrari and rivals like Lamborghini. It helps burnish their high-performance credentials and guarantees a buzz with buyers and fans alike, while helping the bottom line because margins on these cars are even higher than with the standard edition models.