Ferrari Orders are Strong Despite Coronavirus Pandemic

Luxury automaker Ferrari reported second quarter financial results this week revealing that income fell 60% due to the impact of the coronavirus pandemic.

Despite this, orders for the company were “very strong” and shares gained almost 4% as Wall Street reacted to the results.

Ferrari Chief Executive Louis Camilleri told analysts that last quarter’s order book was up double digits (percentage) in absolute terms, versus the same period of last year. “Demands remains vibrant and our order book is up significantly,” Camilleri said.

The company reported that sales in April-June had been hit by production suspensions and significantly lower sponsorship and commercial and brand revenues due to the pandemic, which has caused a slump in car sales around the world.

This led to a 60% drop in adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) to 124 million euros ($145 million) in the second quarter. The average forecast was 120 million euros from analysts polled by Reuters.

Looking ahead, the company expects full-year adjusted EBITDA of between 1.075 billion-1.125 billion euros, versus the guidance provided in May for adjusted EBITDA of between 1.05 billion and 1.20 billion.

“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),” remarked Morgan Stanley analysts.

The carmaker also confirmed that two new supercars would be unveiled by the end of this year, despite the COVID-19 pandemic.

“Things are slightly delayed but the plan remains intact,” Camilleri said. “Next year we have some exciting models that will be presented”.