Italian luxury sports-car maker Ferrari (NYSE: RACE) said that its Q-1 operating income rose 11%, to EUR 232-M on strong demand for its V8-powered Portofino convertible and a jump in China deliveries ahead of new emissions regulations.
The Numbers
Metric | Q-1 2019 | Change Vs Q-1 2018 |
---|---|---|
Revenue | 940-M euros | 13% |
Vehicles shipped | 2,610 | 23% |
Adjusted EBIT (earnings before interest and tax) | 232-M euros | 11% |
Adjusted EBIT margin | 24.7% | (0.6 p.p.) |
Net profit | 180-M euros | 22% |
EPS | 0.95 euro | 22% |
Data source: Ferrari
“Adjusted” figures exclude special items. Ferrari had no special items in Q-1 of Y 2019; the adjusted figures are used here to facilitate comparisons. P.p. = percentage points.
As of 15 May 2019, 1 euro = $1.12.

Ferrari’s Portofino is a V8-powered convertible designed to attract new buyers to the brand. Sales have been very strong since its introduction last year.
Ferrari’s Quarter Summary
Ferrari has several different models and they are all very profitable by auto-industry standards. And some are more profitable than others, the mix of models sold in a given Quarter is the principal driver of Ferrari’s EBIT margin.
For investors, Ferrari’s cars are best thought of in 3 groups, listed here in increasing order of profitability:
- Models with 8-cylinder engines, traditionally Ferrari’s volume leaders;
- Models with 12-cylinder engines, higher-priced and more exclusive;
- Limited Edition models, which can be very high-priced, and are typically offered only to select customers.
In Q-1 of Y 2019, Ferrari’s shipments rose 23% from the year-ago frame, but its adjusted EBIT margin fell slightly.
The Big Q: What happened?
The Big A: Demand for the Portofino, a V8-powered convertible introduced last year, has been exceptionally high. Ferrari said that strong demand for the Portofino drove a 30.8% increase in sales of 8-cylinder models. Meanwhile, sales of 12-cylinder cars, led by the still-newish-but-somewhat-older 812 Superfast, rose 4.1% in the quarter, and Ferrari hadn’t yet begun deliveries of its latest limited-edition models, the Monza SP1 and SP2.
The mix of Ferraris sold in the Quarter included a larger proportion of 8-cylinder models than a year ago and fewer Limited Edition models. Ferrari shipped more cars, but its profitability slipped slightly.
From an investing perspective, this is not an issue: Ferrari’s margin will fluctuate as demand shifts among its models. The fact that Ferrari’s newest model is in high demand is good news.
The spike in China sales
Deliveries in China, Taiwan, and Hong Kong jumped a combined 79%, to 328, as Ferrari pushed to fill open orders in China ahead of new emissions regulations. Investors should note that this may have the effect of “pulling ahead” demand, meaning that deliveries may slump a bit in the next 2 of Quarters.
It is worth noting that demand increased in all of Ferrari’s other regions as too:
- Deliveries in Europe, the Middle East, and Africa rose 10% to 1,209;
- Deliveries in North and South America rose 27% to 720;
- Deliveries in the rest of Asia Pacific rose 29% to 353.
Looking ahead: Ferrari confirms Y 2019 guidance
Ferrari confirmed that it’s on track to meet the full-year guidance it gave in January.
Metric | 2019 Guidance | 2018 Actual |
---|---|---|
Revenue | More than 3.5-B euros | 3.4-B euros |
Adjusted EBITDA | Between 1.2 – 1.25-B euros | 1.1-B euros |
Adjusted EBITDA margin | Around 34% | 32.6% |
Adjusted EBIT | Between 850 – 900-M euros | 825 million euros |
Adjusted EBIT margin | Around 24.5% | 24.1% |
Adjusted EPS | Between 3.50 -3.70 euros | 3.40 euros |
Industrial free cash flow | Around 450-M euros | 400-M euros |
Data source: Ferrari “EBITDA” is earnings before interest, tax, depreciation, and amortization.
Analysts ratings: According to the latest consensus data compiled by Thomson Reuters, 36% of analysts covering Ferrari gave its stock “buy” recommendations. The remaining 64% of these analysts recommended a “hold,” None of the total 11 analysts polled by Reuters expect its stock to fall and gave it “sell” ratings.
Ferrari is the Aristocrat of the automotive sector.
The iconic Italian Supercar manufacturer claimed the title according to the latest Brand Finance Global 500 2019 report launched at the World Economic Forum in Davos.
HeffX-LTN overall technical outlook for RACE is Bullish to Very Bullish, there is light resistance now at 146.88, and strong support at 136.76, all of our Key indicators are Very Bullish in here
Stay tuned…
Latest posts by HEFFX (see all)
- Tesla Is Hiring Someone To Defend Elon Musk And Fend Off Attacks By Twitter Trolls - January 20, 2021
- PayPal Will Continue To Profit From A Huge Increase In Volume And Accounts - January 20, 2021
- Google’s Ethical AI Division Investigating Sharing of Sensitive Documents - January 20, 2021