Ducati Motor Holding Announces Results for First Nine Months of 2002
BOLOGNA, Italy, Nov. 15 Ducati Motor Holding S.p.A. a leading manufacturer of high performance motorcycles, today announced results for the nine month period ended September 30, 2002As previously reported, the Company announced consolidated revenues for the first nine months of 2002, of Euro 298.9 million, up 5.5% from Euro 283.4 million during the same period in the previous year. Revenues from Ducati motorcycles for the period increased 2.4% to Euro 242.1 million and represented 81.0% of revenues. Motorcycle-related products reached Euro 55.8 million, up 20.2% over the same period last year.For the first nine months of 2002, gross margin was 40.8% versus 41.1% in the previous year, mainly due to a positive product mix effect from related products and production efficiencies which were more than offset by a negative country mix and foreign exchange effects.
EBITDA (earnings before interest, tax, depreciation and amortization) for the first nine months of 2002 was Euro 38.8 million and represented 13.0% of sales, down from Euro 48.6 million, or 17.2% of revenues, in the comparable period last year. This is mostly due to costs related to investments for the development of the Ducati Desmosedici GP motorcycle, the restructuring of Ducati's US distribution network, promotional activities such as the biennial World Ducati Week and the negative impact of foreign exchange rates.
Net earnings for the first nine months were Euro 2.0 million compared to Euro 9.0 million in the prior year period. This is mainly due to factors mentioned above, along with increased depreciation, amortization and foreign exchange losses.
"The nine month period has been characterised by the combination of a slower-than-expected recovery of our US operations, an adverse foreign exchange rate effect and a notable contraction of the Ducati Relevant Market -- after a decade of steady growth -- exacerbated by a generally weak macroeconomic environment," said Enrico D'Onofrio, Ducati Chief Financial Officer. "We therefore think it prudent to reduce our expectations for the 2002 full year to revenue growth between 2 and 3%, with an EBITDA margin around 14%.
"We are confident that our new targets are reasonable and will be met by the Company," said Carlo Di Biagio, Ducati Chief Executive Officer. "Our visibility for the last quarter of 2002 is clear. In the US, we have seen rising registrations which are driving a de-stocking of the dealer network, in line with our strategy. Worldwide, we currently have sufficient orders in hand to meet our new estimates for the full year, particularly driven by great demand for the 999. As a consequence the improved product mix will help to counterbalance negative foreign exchange rate effects.
"Despite the challenging selling environment in 2002, we are continuing to invest in innovative products and brand-building activities to lay the ground for strong and sustained future growth," added Carlo Di Biagio. "I am pleased to report that on November 7th, Ducati swept the board at the UK-based Motorcycle News awards in Birmingham, winning three major prizes, including Manufacturer of the Year for the company deemed to have the best relationship with its customers. Our new 999 Testastretta Superbike was chosen as Overall Machine of the Year across all categories. And just yesterday, the 999 was voted overall winner of the 2002 Motorcycle Design Trophy by the members of the prestigious Motorcycle Design Association. We could not ask for greater recognition. The 999 has been the result of a huge amount of effort and determination from the whole company -- congratulations to everyone involved."
Ducati's net debt at September 30, 2002 was Euro 100.4 million in line with Euro 101.6 million at September 30, 2001, improving versus the indebtedness of Euro 113.9 million at June 30, 2002, mainly thanks to a reduction in working capital.
The company's net debt to total capitalization ratio was 39.0% at September 30, 2002 versus 40.0% at September 30, 2001, and 41.1% at June 30, 2002.
These results have been approved by the Ducati Board of Directors, pending limited review by Company auditors.
All historic Company data are available at the Ducati Investor Relations page.
Founded in 1926, Ducati builds racing-inspired motorcycles characterized by unique engine features, innovative design, advanced engineering and overall technical excellence. Ducati has won eleven of the last thirteen World Superbike Championship titles and more individual victories than the competition put together. The Company produces motorcycles in four market segments which vary in their technical and design features and intended customers: Superbike, Supersport, Monster and SportTouring. The company's motorcycles are sold in more than 40 countries worldwide, with a primary focus in the Western European and North American markets.
Ducati Motor Holding S.p.A. and Subsidiaries
Net Sales and Shipment Data
Three Months Three Months
Ended Ended
Sept, Sept, Sept, Sept,
30 30 30 30
2002 2001 2002 2001
Net Sales (Euro in thousands,
US$ in thousands)
Motorcycles euro euro $ $
45,680 47,133 46,329 47,802
Spare Parts,
Accessories,
Apparel 16,687 14,600 16,924 14,807
Miscellaneous
Other 172 195 174 198
Total net sales euro euro $ $
62,539 61,928 63,427 62,807
Ducati Units
Motorcycle shipments: % Change
North America 499 657 (24.0%)
Main European
market 3,633 2,828 28.5%
Japan 764 836 (8.6%)
Rest of World 883 801 10.2%
Total 5,779 5,122 12.8%
Motorcycle product mix:
Sport Segment
(Superbike &
Supersport) 2,110 2,122 (0.6%)
Sport Naked 3,177 2,314 37.3%
Sport Touring 492 686 (28.3%)
Total 5,779 5,122 12.8%
Unofficial Motorcycle % Change
Registrations:
North America 1,254 1,282 (2.2%)
Main European
market 5,406 5,723 (5.5%)
Japan 959 1,011 (5.1%)
Rest of World 1,218 1,173 3.8%
Total 8,837 9,189 (3.8%)
Ducati Motor Holding S.p.A. and Subsidiaries
Net Sales and Shipment Data
Nine Months Ended Nine Months Ended
Sept, 30 Sept, 30 Sept, 30 Sept,30
2002 2001 2002 2001
Net Sales (Euro in thousands,
US$ in thousands)
Motorcycles euro euro $ $
242,067 236,388 245,504 239,744
Spare Parts,
Accessories,
Apparel 55,789 46,420 56,581 47,079
Miscellaneous
Other 1,039 624 1,054 633
Total net sales euro euro $ $
298,895 283,432 303,139 287,456
Ducati Units
Motorcycle shipments: % Change
North America 2,825 3,637 (22.3%)
Main European
market 18,616 18,502 0.6%
Japan 2,827 2,630 7.5%
Rest of World 4,769 3,670 29.9%
Total 29,037 28,439 2.1%
Motorcycle product mix:
Sport Segment
(Superbike &
Supersport) 11,065 10,518 5.2%
Sport Naked 15,331 15,168 1.1%
Sport Touring 2,641 2,753 (4.1%)
Total 29,037 28,439 2.1%
Unofficial Motorcycle % Change
Registrations:
North America 4,977 5,006 (0.6%)
Main European
market 22,061 21,710 1.6%
Japan 3,125 2,819 10.9%
Rest of World 4,389 3,938 11.5%
Total 34,552 33,473 3.2%
Ducati Motor Holding
S.p.A.
Consolidated Statements of Operations Data
(Euro in thousands, US$ in thousands, except per share and
share amounts)
Three Months Ended Three Months Ended Percent
Sept, Sept, Sept, Sept, Change
30 30 30 30
2002 2001 2002 2001
Net Sales euro euro $ $ 1.0%
62,539 61,928 63,427 62,807
Cost of goods
sold (36,623) (34,228) (37,143) (34,714)
Gross Profit 25,916 27,700 26,284 28,093 (6.4%)
Other
operating
revenues 2,450 1,723 2,485 1,747
SG&A expenses (28,296) (24,333) (28,698) (24,678)
Other operating
income/(expense),
net (33) 134 (33) 136
Depreciation &
amortization (8,888) (8,084) (9,014) (8,199)
Operating
income/(loss) (8,851) (2,860) (8,976) (2,901) 209.5%
Financing
expense, net (2,250) (4,502) (2,282) (4,566)
Other
non-operating
income/
(expense), net (20) 57 (20) 58
Profit/(loss)
before income
taxes and
min. interest (11,121) (7,305) (11,278) (7,409) 52.2%
Income taxes 5,125 3,191 5,199 3,236
Net profit/(loss) euro euro $ $ 45.7%
(5,996) (4,114) (6,079) (4,173)
Earnings per euro euro $(0.04) $(0.03)
share (0.04) (0.03)
Shares
outstanding 158,500,963 158,500,963 158,500,963 158,500,963
Percent
Other Financial Data Change
Motorcycles
Produced (Units) 8,413 7,199 16.9%
Motorcycles
Sold (Units) 5,779 5,122 12.8%
Unofficial
Registrations
(Units) 8,837 9,189 (3.8%)
EBITDA 17 5,281 17 5,356 (99.7%)
EBITDA Margin 0.0% 8.5%
Note : On Sept 30, 2002 US$1= 0,9860 Euros
Ducati Motor Holding
S.p.A.
Consolidated Statements of Operations Data
(Euro in thousands, US$ in thousands, except per share and
share amounts)
Nine Months Ended Nine Months Ended
Sept, Sept, Sept, Sept, Percent
30 30 30 30 Change
2002 2001 2002 2001
Net Sales euro euro $ $ 5.5%
298,895 283,432 303,139 287,456
Cost of goods
sold (176,810) (166,915) (179,320) (169,285)
Gross Profit 122,085 116,517 123,819 118,171 4.8%
Other
operating revenues 7,961 4,750 8,074 4,817
SG&A expenses (90,040) (72,975) (91,318) (74,0110)
Other operating
income (1,166) 136 (1,183) 138
Depreciation &
amortization (24,533) (22,932) (24,882) (23,258)
Operating
income/(loss) 14,307 25,496 14,510 25,857 (43.9%)
Financing
expense, net (10,618) (9,589) (10,769) (9,725)
Other non-operating
income/(expense),
net (20) 186 (20) 189
Profit/(loss) before
income taxes and
min. interest 3,669 16,093 3,721 16,321 (77.2%)
Income taxes (1,652) (7,109) (1,675) (7,211)
Net profit/(loss) euro euro $ $ (77.5%)
2,017 8,984 2,046 9,110
Earnings per euro euro $0.01 $0.06
share 0.01 0.06
Shares
Outstanding 158,500,963 158,500,963 158,500,963 158,500,963
Percent
Other Financial Data Change
Motorcycles
Produced
(Units) 30,923 31,781 (2.7%)
Motorcycles
Sold (Units) 29,037 28,439 2.1%
Unofficial
Registrations
(Units) 34,552 33,473 3.2%
EBITDA 38,820 48,614 39,371 49,303 (20.1%)
EBITDA Margin 13.0% 17.2%
Note : On Sept 30, 2002 US$1= 0,9860 Euros
Ducati Motor Holding S.p.A.
Consolidated Statements of Operations Data
(Euro in thousands, except per share and share amounts)
Three Months ended Three Months ended
September 30, 2002 September 30, 2001
euro % euro %
Current assets
Cash and cash
equivalents 16,606 15,970
Trade receivables,
net 61,135 55,444
Inventories 111,856 105,221
Other current
assets 17,617 13,853
Total current
assets 207,214 50.0% 190,488 48.1%
Non current assets
Property, plant and
equipment-net 63,082 55,307
Intangible fixed
assets, net 128,759 134,675
Equity investments 1 84
Long term assets -
Credit Link 15,000 15,000
Other long-term
assets 646 643
Total non current
assets 207,488 50.0% 205,709 51.9%
Total assets 414,702 100.0% 396,197 100.0%
Current liabilities
Short-term bank
borrowings 20,434 19,365
Current portion of
long-term debt 2,822 2,491
Accounts payable -
trade 83,773 71,026
Income and other
taxes payables 5,042 3,773
Other current
liabilities 17,609 17,369
Provisions for
risks and charges -
current portion 9,421 9,597
Total current
liabilities 139,101 33.5% 123,621 31.2%
Long-term liabilities
Long-term debt, net
of current portion 91,000 91,000
Employees' leaving
entitlement 6,686 5,474
Deferred income
taxes 35 483
Other long-term
liabilities 17,737 19,694
Provision for risks
and charges - long
term portion 3,262 3,305
Total long-term
liabilities 118,720 28.6% 119,956 30.3%
Total liabilities 257,821 243,577
Total Group
shareholders'
equity 156,881 37.9% 152,620 38.5%
Minority interests
Total shareholders'
equity 156,881 37.9% 152,620 38.5%
Total liabilities
and shareholders'
equity 414,702 100% 396,197 100%
Memo : Net
consolidated
financial position (100,387) (101,580)
Ducati Motor Holding S.p.A.
Consolidated Statements of Operations Data
(US$ in thousands, except per share and share amounts)
Three Months ended Three Months ended
September 30, 2002 September 30, 2001
US$ % US$ %
Current assets
Cash and cash
equivalents 16,374 15,746
Trade receivables,
net 60,279 54,668
Inventories 110,290 103,748
Other current assets 17,370 13,659
Total current assets 204,313 50.0% 187,821 48.1%
Non current assets
Property, plant and
equipment-net 62,199 54,532
Intangible fixed
assets, net 126,956 132,790
Equity investments 1 83
Long term assets -
Credit Link 14,790 14,790
Other long-term
assets 637 634
Total non current
assets 204,583 50.0% 202,829 51.9%
Total assets 408,896 100.0% 390,650 100.0%
Current liabilities
Short-term bank
borrowings 20,148 19,094
Current portion of
long-term debt 2,782 2,456
Accounts payable -
trade 82,601 70,032
Income and other
taxes payables 4,971 3,720
Other current
liabilities 17,362 17,126
Provisions for risks
and charges -
current portion 9,289 9,463
Total current
liabilities 137,153 33.5% 121,891 31.2%
Long-term
liabilities
Long-term debt, net
of current portion 89,726 89,726
Employees' leaving
entitlement 6,592 5,397
Deferred income
taxes 35 476
Other long-term
liabilities 17,489 19,418
Provisionfor risks
and charges - long
term portion 3,216 3,259
Total long-term
liabilities 117,058 28.6% 118,276 30.3%
Total liabilities 254,211 240,167
Total Group
shareholders' equity 154,685 37.9% 150,483 38.5%
Minority interests
Total shareholders'
equity 154,685 37.9% 150,483 38.5%
Total liabilities
and shareholders'
equity 408,896 100.0% 390,650 100.0%
Memo : Net
consolidated
financial position (98,981) (100,158)