Piaggio (PIA) Q2 2024 earnings summary

Executive summary

• Net sales for H1 2024 were €990.3 million, down 15.2% year-over-year, with 270,100 vehicles sold globally, a 16.8% decrease, mainly due to weaker performance in Asia and the USA, while India showed growth.

• Net profit was €52.1 million, a 19.6% decrease, but margins improved, with EBITDA margin at 17.5% and EBIT margin at 10.5%, both at or near record levels.

• Positive cash flow was achieved, reversing prior cash absorption, and net financial debt reduced to €408 million.

• Strategic investments continue in electric mobility, digitalization, and production upgrades, with 2024 and H1 2025 expected to be peak years for capital expenditure.

• Interim dividend set at €0.115 per share, down from €0.125 in 2023.

Financial highlights

• Net sales declined 15.2% year-over-year to €990.3 million, with gross margin up to 29.8% (+170 bps), EBITDA margin at 17.5% (+117 bps), and EBIT margin at 10.5% (+44 bps).

• Net income fell 19.6% to €52.1 million, with financial expenses up 35.5% due to higher funding costs.

• Net financial debt decreased to €408 million, leverage at 1.3x, and shareholders' equity increased to €443.2 million.

• Investments in property, plant, and equipment and intangible assets totaled €77.3 million, up 17.4% year-over-year.

• Earnings per share were €0.147, down from €0.183 in H1 2023.

Outlook and guidance

• Margins are expected to be maintained or slightly improved for full-year 2024, despite anticipated cost increases and market slowdowns in some regions.

• Investment in new products and ESG initiatives will continue, focusing on energy transition and vertical integration.

• CapEx increased by ~€11 million year-over-year, aligned with full-year targets and maintaining flexibility for H2 investments.

• No significant recovery is expected in Asia for the remainder of 2024, though Vietnam is stabilizing.

• New vehicle launches are planned for H2 2024, primarily Euro 5 Plus compliant models.