Luxury carmaker Ferrari trimmed its full-year earnings forecast on Monday after second-quarter income plunged due to supply chain and production disruptions during the coronavirus pandemic.
FILE PHOTO: The logo of Ferrari is seen on a car during the Prague Autoshow in Prague, Czech Republic, April 13, 2019.
MILAN: Luxury carmaker Ferrari trimmed its full-year earnings forecast on Monday after second-quarter income plunged due to supply chain and production disruptions during the coronavirus pandemic.
However the guidance review from the company known for its “prancing horse” symbol proved marginal and results left analysts upbeat on its performance, which also confirmed it expected to generate positive free cash flow this year.
Analysts at Morgan Stanley said given the circumstances second-quarter results were strong from the company, maker of high performance models such as the F8 Spider, the 1,000 horse power SF 90 Stradale hybrid and top-selling Portofino grand tourer.
“The full year 2020 guidance, while lowered marginally at the midpoint and below consensus, is extremely high quality and sets up 2021 for a significant year on year (improvement),” they said.
Milan-listed shares in Ferrari rose as much as 3.3per cent after briefly falling after the results. They were up 2.9per cent at 1250 GMT.
The company said sales had been hit by production suspensions and significantly lower sponsorship and commercial and brand revenues due to the pandemic.
That resulted in a 60per cent drop in adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) to 124 million euros (US$145 million) in the second quarter, in line with a Reuters an average forecast of 120 million euros from analysts polled by Reuters.
The company said it now expected full-year adjusted EBITDA of between 1.075 billion euros and 1.125 billion, versus the already-cut guidance it provided in May for adjusted EBITDA of between 1.05 billion and 1.20 billion.
“This guidance reflects an updated assessment of the projected impact of the COVID-19 pandemic on the company’s supply chain and the resulting delay in the full production ramp-up of the SF90 Stradale,” Ferrari said in a statement, referring to its hybrid electric model.
Ferrari said it was also hit by the temporary suspension of the Formula 1 season which resulted in a reduced number of races as well as reduced in-store traffic and museum visitors.
The carmaker now expects revenue to top 3.4 billion euros this year, versus previous guidance of between 3.4 billion and 3.6 billion.
