Release Date: September 05, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Sanlorenzo SpA (FRA:6SZA, Financial) reported a 6.9% increase in net revenue, reaching EUR415.1 million, driven by strong performance in the superyacht division.
- EBITDA grew by 9.7% year-on-year to EUR74.2 million, with an EBITDA margin increase of 50 basis points to 17.9%.
- The company has a solid backlog of almost EUR1.4 billion, providing strong visibility for future results.
- Sanlorenzo SpA (FRA:6SZA) successfully acquired Simpson Marine, enhancing its presence in the APAC region.
- The acquisition of Swan is expected to contribute positively, with an estimated EUR35-40 million in revenue and EUR4-5 million in EBITDA for the five months of consolidation in 2024.
Negative Points
- The shift to direct distribution has caused a temporary lag in order intake, particularly affecting the APAC region.
- The European market has shown a 10% reduction in sales, influenced by the war in Ukraine and a sluggish German economy.
- The company faces challenges in the below 24-meter yacht segment, which has shown weaker order intake compared to larger yachts.
- The acquisition of Swan, while promising, introduces complexities in integration and requires significant investment in new production facilities.
- Sanlorenzo SpA (FRA:6SZA) has experienced a cash absorption of approximately EUR38 million year-on-year, linked to acquisitions and increased dividend payments.
Q & A Highlights
Q: Considering the acquisition of Swan, can you provide us a new guidance or confirm the previous dividend policy guidance of 30%-40% payout net of extraordinary acquisition?
A: We do not have any reason to change the current dividend policy, so it will remain as indicated in our business plan documentation. (Attilio Bruzzese, CFO)
Q: What is your feeling on the demand, especially in Europe for yachts, and what is your expectation in Q3 compared to last year in terms of order intake?
A: Europe has seen a 10% reduction in sales, which was expected due to the war in Ukraine and the German economy. However, recent weeks have shown promising signs with several yachts sold in Europe. We anticipate a good boat show season starting soon. (Massimo Perotti, CEO)
Q: Can you provide a breakdown of your order intake by yacht category and the outlook for Swan's EBITDA margin?
A: We generally see more difficulty for boats below 24 meters. For Swan, the EBITDA margin is expected to remain at the current level or improve slightly. The recent sales of four maxi yachts have added EUR160 million to the backlog, which is promising for 2025 and beyond. (Massimo Perotti, CEO)
Q: Are you going to keep the Swan motorboat line or drop it?
A: We will keep the Swan motorboat line but focus on a niche market, maintaining the heritage and quality of Swan. The motorboat segment will likely account for around 10%-15% of the business in the future. (Massimo Perotti, CEO)
Q: Could you elaborate on the synergies and timing of their delivery from the Swan acquisition?
A: Synergies will take about 24 months to fully materialize. We are planning a new plant in Northern Italy to increase production capacity. We expect to see improvements in purchasing costs and EBITDA margins by 2025. (Massimo Perotti, CEO)
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
