Ferrari profits grow in Q1 despite delivering fewer cars 

Italian luxury carmaker Ferrari on Monday said all key economic indicators grew in the first three months of the year despite having delivered fewer cars.

 

In an e-mailed statement, the company said net profits rose 5 percent to over €57 million, while trading profit equalled last year’s €80 million. 

 

Revenues leaped by 12.5 percent to €620 million despite a 6 percent drop in the number of road cars delivered to 1,699 – or 100 less than a year earlier. 

 

Despite the California production currently phasing out and no new California T's have been delivered, this result is considered "very meaningful," the carmaker said.

 

Ferrari’s strategic decision to reduce its output in order to maintain its cars' exclusivity and high residual value was taken in May last year and thus had no impact on first quarter 2013.

 

The company's net industrial financial position was just shy of €1.5 billion as of end-March, confirming its ability to generate strong cash flows, the carmaker said.

 

Net industrial cash flow reached €129 million in the first quarter, while returns on sales surged to 13 percent despite still-significant investments in product.

  

Ferrari board of directors chair Luca do Montezemolo said they want to limit the total production of their cars under the 7,000 mark for this year as well while strengthening their economic results.

 

"This target poses an even greater challenge in the light of the very substantial investments we are making in both our product and Formula One where an exceptional effort, financially as well, is required to bridge the gap with our competitors,” he said.

 

Sales in the US continue to soar as demand remains consistently high, registering an 8 percent growth despite deliveries being restricted.

 

Likewise, the Middle East market continues to expand – rising to 6 percent.

 

In Asia, Japan and China yielded positive results with deliveries almost doubling in Japan, compared with a year earlier, and China registering a 4-percent increase. 

 

In Europe, the UK remains the continent's leading market, recording a 3 percent increase with demand still consistently high. 

 

Meanwhile, in Italy there was a 13 percent increase. 

 

However, there was a slight drop in demand in Germany as a result of limiting the number of cars sent to more mature markets as well as the end of the California’s life-cycle.

 

Ferrari's brand activities such as licensing, retail and e-commerce saw a 19 percent improvement in direct retail revenues with e-commerce up by 10 percent, the carmaker said.

 

"Several important new licensing agreements were also signed in the early months of the year, including one for the building of the Ferrari Land theme park in Spain and another with the world-leading eyewear company, Oakley, for an eyewear range and sponsorship of Scuderia Ferrari," Do Montezemolo said. – Janelle Cosino/VS, GMA News