Ferrari announces its final end of year results and sales and profits are all up, and looking good for the coming year.

• Total shipments reached 2,214 units, up 8% (+155 units)
• Net revenues grew 5.9% (+6.2% at constant currencies) to Euro 811 million
• Adjusted EBIT⁽¹⁾ of Euro 156 million, 310 bps margin increase
• Adjusted net profit⁽¹⁾ up 35% to Euro 104 million
• Net industrial debt^([1]) at Euro 763 million, better than March 2016

Adjusted EBIT(1)	Net profit
Volume increase of approx. 230 cars (excluding LaFerrari) thanks to the newly launched 488 GTB, 488 Spider, F12tdf and positive contribution from personalization	Net profit for Q2 was Euro 97 million up Euro 21 million (+29%) due to the combined effect of strong EBIT and lower tax rate vs. previous year partially offset by charges for Takata airbag inflator recalls
Negative mix impacted by LaFerrari, that finished its limited series run, and V8, slightly higher compared to the previous year, partially offset by the non-registered car FXX K and limited edition F60 America
Net industrial debt(1)	Confirming 2016 Outlook([2])
Net industrial debt(1) reduced to Euro 763 million, primarily due to strong industrial free cash flow(1)generation partially offset by cash distribution to holders of common shares and dividends paid to NCI	The Group guidance is confirmed as follows: Shipments: ~8,000 units including supercars Net revenues: > Euro 3 billion Adjusted EBITDA: ≥ Euro 800 million Net industrial debt([3]): ≤ Euro 730 million

Ferrari N.V. (NYSE/MTA: RACE) (“Ferrari” or the “Company”) today announces its consolidated preliminary results^([4]) for the second quarter and six months ended June 30, 2016.

Shipments

Shipments totaled 2,214 units in Q2 2016, up 8% from the previous year. 

This performance was driven by a 16% increase in sales of our 8 cylinder models (V8), led by the success of the two newly launched models: the 488 GTB and the 488 Spider. Shipments of the 12 cylinder models (V12) were down 22% due to the phase-out of the FF, the F12berlinetta now in its 5^th year of commercialization and LaFerrari that finished its limited series run. This was partially offset by the introduction of the new F12tdf.

The EMEA^([5]) and Greater China⁽⁵⁾ regions experienced a sound year-on-year growth with shipments increasing respectively by +14% and +26%, Americas⁽⁵⁾ recorded a slight  improvement whereas Rest of APAC⁽⁵⁾ remained in line with the previous year due to 488 Spider and F12tdf having just arrived on the market.

Total net revenues

Net revenues for Q2 2016 were Euro 811 million, an increase of Euro 45 million or 5.9% (+6.2% at constant currencies) from Q2 2015. Higher net revenues in Cars and spare parts⁽⁶⁾ (Euro 589 million, +2%) were due to increased volumes led by new models 488 GTB, 488 Spider,F12tdf, the non-registered car FXX K and the final deliveries of the F60 America, a strictly limited edition car, along with a higher contribution from personalization, which was partially offset by lower sales of LaFerrari. The rebound in Engines⁽⁷⁾ (Euro 71 million, +24%), was mainly attributable to higher rental revenues from other Formula 1 Teams. Sponsorship, commercial and brand⁽⁸⁾(Euro 117 million, +14%) was up mostly due to better championship ranking, higher sponsorship revenues and positive contribution from brand related activities.

Adjusted EBITDA⁽¹⁾ and Adjusted EBIT⁽¹⁾

Adjusted EBIT⁽¹⁾ was Euro 156 million, up Euro 32 million (+26%) from Q2 2015 as a result of higher volumes, thanks to the newly launched 488 GTB, 488 Spider and the F12tdf as well as a positive margin contribution from our personalization programs. Mix was negatively impacted (Euro 25 million) by higher V8 versus V12 range models with LaFerrari that finished its limited series run, partially offset by the non-registered car FXX K and the final deliveries of the F60 America, a strictly limited edition car (only ten units) manufactured to commemorate the 60^th Anniversary of Ferrari in North America. Research and development costs and industrial costs showed a decrease of Euro 11 million mainly due to lower D&A for the 458 family and LaFerrari phase-out coupled with efficiencies on production costs partially offset by F1 costs. The Selling, general and administrative costs^([10])were substantially in line with the previous year as the combined result of new store openings, new model launches and corporate costs offset by bad debt in Q2 2015. Other recorded a positive contribution of Euro 14 million thanks to Sponsorship, commercial and brand as well as other supporting activities.

Adjusted EBIT⁽¹⁾ excludes charges of Euro 10 million due to the worldwide Takata airbag inflator recalls^([11]).

Tax rate dropped to 30.7% in Q2 2016 vs. 33.5% in Q2 2015 as a result of the Italian Government’s decision to reduce the nominal tax rate from 27.5% to 24% by 2017.

As a result of the items described above, adjusted net profit⁽¹⁾ for Q2 2016 was Euro 104 million, up Euro 26 million (+35%).

Industrial free cash flow⁽¹⁾ for the three months ended June 30, 2016 was Euro 145 million, primarily driven by a strong increase in cash flow from operating activities, including a positive change of working capital and timing effect of advances on the new open-top LaFerrari, partially offset by capex and the first 2016 tax advance. Q2 2015 industrial free cash flow⁽¹⁾ included a Euro 116 million one-time cash in-flow related to the final reimbursement by Maserati of its inventory in China.

Net industrial debt⁽¹⁾ at June 30, 2016 was Euro 763 million, better than from Euro 782 million at March 31, 2016, thanks to industrial free cash flow⁽¹⁾ generation offset by cash distribution for Euro 87 million paid to the holders of common shares and Euro 13 million dividends paid to NCI.

The open-top LaFerrari: the new special limited-edition series

On July 5^th, 2016 Ferrari unveiled the first images of the open-top LaFerrari, the new limited-edition special series. The new model, already pre-sold, will be presented during the Paris International Motor Show in October 2016. The open-top LaFerrari will be provided with a removable carbon-fiber hard top and a removable soft top aimed at customers and collectors who refuse to compromise on the joy of plein air driving even when at the wheel of a supercar.

Subsequent Events

On July 7^th, 2016 Ferrari with Luxottica Group announced the signing of a sponsorship agreement for the Ray-Ban brand to appear on the SF16-H Formula One cars.

World Premiere of the new FXX K at the Ferrari Mondiali in Abu Dhabi.

Ferrari’s new FXX K research and development programme receives its world premiere next weekend at the Yas Marina Circuit in Abu Dhabi. The laboratory-car is based on Maranello’s first hybrid model and will grace the world’s tracks from next year onwards. The K in its moniker is a reference to the “KERS” kinetic energy recovery system it adopts in maximising its track performance.  

Unfettered by homologation and racing regulations, the FXX K will never be used in competition. It was, in fact, developed to be completely uncompromising, incorporating technological innovations that will guarantee an unprecedented driving experience to the exclusive group of Client-Test Drivers with whom the Prancing Horse will roll out a test programme over the coming two years.

The car’s enormous potential is attested to by two significant figures:  a total power output of 1050 cv (860 cv delivered by its conventional V12 engine and 190 by its electric motor) and maximum torque in excess of 900 Nm.

The FXX K’s 6262 cc V12 features new camshafts and a modified valve train with mechanical rather than hydraulic tappets. The intake manifolds have been redesigned and given a special type of polishing treatment. The exhaust system has been modified as its silencers have been eliminated.

The HY-KERS system has been evolved specifically for pure performance with the result that the driver can control the function logics from the specific 4-setting Manettino on the centre console: Qualify, for maximum performance within a limited number of laps; Long Run to optimise performance consistency; Manual Boost for instant maximum torque delivery; and Fast Charge, for a fast recharge of the car’s battery. 

A focus on delivering maximum efficiency at every stage of every track lap has resulted in extensive but integrated work on the entire car body in terms of both active and passive aerodynamics.  

The front of the car is dominated by a twin-profile spoiler and a larger splitter, which is 30 mm lower, with a gap in its centre. This design is an application of the concepts developed to improve aero balance in the GT category of the WEC, which Ferrari has won for three consecutive years.  

Two pairs of vertical elements, an endplate and, externally, a dive plane, together with vertical fins channel the air towards the car’s flanks, generating a longitudinal vortex that creates a localised depression. This in turn sucks the wake from the wheels to the outside of the aerodynamic underbody. Along with the side skirts that extend out from the sills, the vortex helps isolate the airflow from the underbody to boost its efficiency.

The solutions on the rear of the car are highly sophisticated, too. The tail section is now higher and the mobile spoiler extends further for a total increase in extension of 60mm when fully deployed. A vertical fin and a small wing each side of the tail act as guide vanes in the low drag configuration and boost the spoiler’s efficiency in the high downforce one. 

This system also creates considerable downforce at the rear of the car, allowing the use of an extreme diffusion volume for the rear diffuser which optimises air extraction from the underbody.  The section of the flat underbody just ahead of the rear wheels is also exploited to the full to generate downforce thanks to the reduced pressure in the wheel arch guaranteed by the direct connection to the rear of the car by a by-pass duct.

The result is a 50% improvement in downforce in the low drag configuration and a 30% improvement in the more aggressive downforce configuration, resulting in a figure of 540 kg at 200 km/h.

Vehicle dynamics are further improved by the adoption of Pirelli slicks complete with sensors that monitor longitudinal, lateral and radial acceleration, as well as temperature and pressure. This ensures an accurate analysis of the interaction between the tyre and track surface, providing even more vital data to enable the traction control system to guarantee maximum performance.

The intervention level of the E-Diff electronic differential, F1-Trac traction control, Racing SSC (Side Slip Angle Control) - now specially calibrated to suit the car’s slick tyres - and the high-performance ABS can be controlled using the five-position Manettino on the steering wheel.