Piaggio Group: board approves 2010 draft financial statements

Mar 07 2011 17:12
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Consolidated Net sales € 1,485.4 million (€ 1,486.9 million in 2009)

Industrial gross margin € 462.3 million (€ 467.1 million in 2009)

EBITDA € 197.1 million (€ 200.8 million in 2009)

EBIT up to € 111.1 million (€ 104.4 million in 2009)

Profit before tax up to € 83.8 million (€ 74.1 million in 2009)

Net profit € 42.8 million (€ 47.4 million in 2009) after tax totalling € 41 million (€ 26.7 million in 2009)

Net debt down to € 349.9 million (from € 352 million at 31 December 2009)

628,400 vehicles shipped (607,700 in 2009)

Strong growth on Asian markets, in two-wheelers and commercial vehicles

Parent company Piaggio & C. S.p.A.: net profit € 18.8 million

Proposed dividend € 0.07 per share (€ 0.07 in 2009)

Milan, 7 March 2011 – At a meeting today in Milan chaired by Roberto Colaninno, the Board of Directors of Piaggio & C. S.p.A. examined and approved the 2010 draft financial statements.

In 2010, the Piaggio Group reported results substantially in line with 2009, despite the significant fall in European demand in the two-wheeler sector. Its performance reflected Piaggio’s strong expansion on Asian markets – in both the two-wheeler and the commercial vehicle businesses – as a result of the strategy for globalisation of investments, production and marketing operations undertaken with determination by the Group.

Group consolidated net sales in 2010 amounted to € 1,485.4 million – in line with the 2009 figure of € 1,486.9 million – of which € 988.1 million in the two-wheeler sector and € 497.3 million in commercial vehicles.

In 2010 the Piaggio Group shipped a total of 628,400 vehicles worldwide (compared with 607,700 in 2009), including 395,000 vehicles in the two-wheeler business (scooters and motorcycles) and 233,400 three- and four-wheel commercial vehicles.

In the two-wheeler sector, the Group’s performance in the EMEA area – with 329,100 vehicles shipped in 2010 – was conducted in difficult market conditions, with a 12.3% fall in overall market demand in the area. In this scenario, the Group kept its European market share at 20%.
In Asia, the Piaggio Group reported a particularly strong performance in the two-wheeler business, with 59,500 vehicles shipped, an improvement of 60.5% on 2009, reflecting the success of its Vietnamese subsidiary, whose plant began production in June 2009.

In commercial vehicles, Piaggio Vehicles Private Ltd. continued to enhance its leadership position on the Indian three-wheeler market – which grew by approximately 22% in 2010 – winning a 39% market share and shipping 210,000 three-wheelers, an improvement of 22.4% on 2009, and 10,000 four-wheel vehicles (in line with the volumes reported in 2009).
On the European commercial vehicle market, in 2010 the Piaggio Group shipped 13,300 vehicles. It focused specifically on its offer of eco-sustainable four-wheel vehicles with low or zero emissions (Piaggio Porter range), and also reported an increase in shipments and turnover for the three-wheel Ape vehicle range.

The 2010 industrial gross margin was € 462.3 million, compared with € 467.1 million in 2009. The return on net sales was 31.1%, substantially in line with 2009 (31.4%).

Consolidated EBITDA for 2010 was € 197.1 million, against € 200.8 million in 2009. The EBITDA margin was 13.3% (compared with 13.5% in the previous year).

In terms of EBIT, performance in 2010 was better than in 2009, with consolidated EBIT of € 111.1 million, an improvement of € 6.7 million on 2009. The EBIT margin for 2010 increased to 7.5% (7.0% in 2009).

Profit before tax in 2010 rose to € 83.8 million (+9.7 million from € 74.1 million in 2009) and generated a significant increase in tax for the year to € 41 million, compared with € 26.7 million in 2009. Consolidated net profit was € 42.8 million, against € 47.4 million in 2009.

The Group posted a significant improvement in financial operations compared with 2009, with net financial charges of € 27.3 million (€ 30.3 million in 2009).

In 2010, the Piaggio Group made investments for € 96.2 million, up from € 93.8 million in 2009.

Consolidated net debt decreased from € 352 million as of 31 December 2009 to € 349.9 million as of 31 December 2010. The improvement in the net financial position was largely due to the positive trend in operating cash flow as well as positive management of net working capital, enabling the Group to self-fund investments and also distribute dividends for an amount of € 25.8 million and buy back shares for approximately € 3.3 million.

Shareholders' equity as of 31 December 2010 was € 442.9 million, an increase of approximately € 19.1 million from 31 December 2009.

Events after 31 December 2010

On 13 January 2011 Davide Scotti was appointed VP for Product Development & Strategies, replacing Maurizio Roman who left the company.

On 27 January 2011 the Group presented the new line of Piaggio Porter commercial vehicles, featuring the new Euro 5 petrol and diesel engines. Particularly important is the new 1200 cc turbodiesel model, the lead product of a new family of diesel engines designed and developed by the Group and manufactured at its factory in Baramati, India.


In 2011, consistently with the Group Business Plan presented in September 2010, Piaggio Group strategy will continue to focus on industrial and commercial growth in Asia and consolidation on Western markets. Regarding sales, the Group aims to expand and strengthen its position in all sectors and markets: in India, it intends to consolidate its leadership position on the three-wheel light commercial vehicle market and develop sales in four-wheelers; in the Asia Pacific area, it will boost its share of the scooter market in Vietnam, and simultaneously grow operations in the rest of area, with a specific focus on Indonesia, Thailand and Malaysia; in Europe and America its goal is to bolster its leadership in scooters, enhance its competitive positioning in motorcycles and increase sales of light commercial vehicles.
In production, the Piaggio Group plans to start up operations at the new engine factory in India, upgrade production capacity at the Vietnamese facility and build another new factory in India to produce two-wheelers for the local market. It will give priority to improving industrial productivity, with a special focus on European operations, by optimising production systems. Significant resources will be devoted to R&D, for the on-going renewal of the Group product range for Western markets and for the developing countries, with special attention to development of engines with low fuel consumption and no or low environmental impact.

Piaggio & C. S.p.A.

The parent company reported 2010 net sales of € 976.8 million, EBITDA of € 74.9 million, negative EBIT of € 1.7 million and a net profit for the year of € 18.8 million.

Proposed dividend of 0.07 euro 

The Board of Directors will ask the shareholders' meeting to approve distribution of a dividend of 0.07 euro per ordinary share (compared with a dividend of 0.07 euro for 2009), not including the quota for remaining own shares pursuant to art. 2357-ter Italian Civil Code, for a total value of
€ 25,684,000.00.
The ex dividend date will be 16/05/2011, with payment on 19/05/2011.

Authorisation for purchase and disposal of own shares

At today’s meeting the Board of Directors decided to ask the shareholders' meeting to authorise the purchase and disposal of own shares, given that the authorisation to conduct own-share transactions approved by the Piaggio shareholders' meeting of 16 April 2009 expired on 16 October 2010. The proposal is designed to give the company a useful strategic investment opportunity for the purposes allowed by law, including the purposes envisaged in the market practices allowed by Consob pursuant to art. 180, par 1, head c) of the consolidated finance act with resolution no. 16839 of 19 March 2009 and in EC Regulation no. 22/2003 of 22 December 2003, and also to proceed with share buy-backs with a view to subsequent cancellation.

Restructuring of Group operations in Spain

At the meeting the Piaggio Board of Directors approved plans to restructure current production operations in Spain at the Martorelles factory (Barcelona) of the subsidiary Nacional Motor S.A.U.. The project provides for production operations to be transferred to the Piaggio Group’s Italian factories. In addition to rationalising the Group production network in Europe, guaranteeing greater efficiency and productivity, the move will strengthen the competitiveness of Derbi vehicles to support the growth of the Spanish brand’s market share.

The manager in charge of preparing the company accounts and documents, Alessandra Simonotto, certifies, pursuant to paragraph 2, art. 154 bis of Legislative Decree no. 58/1998 (Consolidated Law on Financial Intermediation), that the accounting disclosures in this statement correspond to the accounting documents, ledgers and entries.

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