Piaggio Group: Board approves 2011 draft financial statements

Feb 23 2012 18:02
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Consolidated net sales € 1,516.5 million (+2.1% from 2010)

 EBITDA € 200.6 million (+1.7% from 2010)

 Net profit € 47 million (+9.8% from 2010)

 Net debt down to € 335.9 million

(from 349.9 million at 31 December 2010)

 Capex € 126.1 million (+31.1% from 2010)


 653,300 vehicles shipped (+4% from 2010)

 Strong growth on Asian markets

 Leadership strengthened on the European two-wheeler market
and the US scooter market

 More than 150,000 Vespa scooters sold in one year


Parent company Piaggio & C. S.p.A.: net profit € 47.0 million

 Proposed dividend € 0.082 per share (€ 0.07 in 2010)


Rome, 23 February 2012 – At a meeting today in Rome chaired by Roberto Colaninno, the Board of Directors of Piaggio & C. S.p.A. examined and approved the 2011 draft financial statements.

The Piaggio Group’s results for 2011 confirm the success of the strategic decisions taken by the Group to globalise its industrial and commercial operations by investing in the regions with the highest growth rates. The main indicators for FY 2011 reflect significant improvements from 2010, despite the two-wheeler market crisis in Europe (in Italy in particular), the impact of non-recurring restructuring charges and the exchange-rate effect, which was particularly significant in 2011.

Group consolidated net sales in 2011 amounted to 1,516.5 million euro – up 2.1% from 1,485.4 million euro in 2010 – including 1,025.3 million euro in the two-wheeler business and 491.1 million euro in commercial vehicles. Net of the exchange-rate effect described above, consolidated net sales growth was 5.2%.

In 2011 the Piaggio Group shipped a total of 653,300 vehicles worldwide (up 4.0% from 628,400 in 2010), including 415,000 vehicles in the two-wheeler business (scooters and motorcycles) and 238,300 three- and four-wheel commercial vehicles.

Looking at performance in the different geographical and business areas, in 2011 the Piaggio Group confirmed its position as European leader in the two-wheeler sector, raising its market share to approximately 20.1%; its market share in scooters improved to approximately 27.6%.

Although the two-wheeler market in the EMEA area showed an overall decline of 9.5% (-11% in scooters and -7% in motorcycles), the Group’s commercial operations in Europe were particularly incisive, so that, with shipments of approximately 300,000 vehicles, the sales slowdown was smaller than the market downturn – leading to an improvement in market share in almost every country – and the revenue decline was contained at 3.5% (2011 turnover 802.5 million euro); this was also thanks to the positive effect on the mix of higher sales of top-end motorbikes, as a result of the success of the latest Moto Guzzi and Aprilia models.

On the American scooter market, which showed signs of an upturn in 2011 (with a 6% increase in overall vehicle registrations from 2010), Piaggio Group penetration made significant progress (market share rising from 27.1% to almost 30%), with shipments of 10,300 vehicles (+63.8% from 2010) and revenues of 35.4 million euro (+53.0%).

Particularly worthy of note is the extraordinary progress in worldwide sales of Vespa branded vehicles to more than 150,000 scooters shipped in 2011. As a comparison, worldwide Vespa scooter sales in 2003 were approximately 50,000.

On the Asian market, 2011 was an extraordinarily positive year for the Group, which reported strong growth compared with 2010, with 104,800 vehicles shipped (+75.9% from 2010) and revenues of 187.5 million euro (+40.8% from 2010). Excluding the exchange-rate effect, revenue growth in this area was 55.1%.

The result reflected the growing success of operations in Vietnam (where marketing began of the Liberty scooter produced in the Vinh Phuc factory, and the milestone of 100,000 Vespas produced since production began in Vietnam in June 2009 was reached in the second half of 2011) and entry on to important new markets in South East Asia: Indonesia, Thailand, Taiwan and Malaysia.

In the commercial vehicles business, the Piaggio Group closed 2011 with a total of 238,300 shipments (+2.1% from 2010) and revenues of 491.1 million euro. This result was substantially in line with the 2010 figure (a reduction of approximately 1%), but would have shown growth of 4.3% at constant exchange rates.

On the Indian three-wheeler market, Piaggio Vehicles Private Limited confirmed its position as the subcontinent’s main player, with a market share of 37.1%. Shipments in India (3- and 4-wheel commercial vehicles) rose by 2.4%, from 219,600 vehicles in 2010 to 225,000 in 2011.


* * *

Consolidated EBITDA was 200.6 million euro in 2011, an increase of 1.7% from 197.1 million in 2010. Although an improvement was reported, the result was affected by non-recurring restructuring charges for approximately 17 million euro, and by the exchange-rate effect, net of which EBITDA growth would have been 8.4%.
The EBITDA margin was 13.2%, in line with 2010.

Consolidated EBIT for 2011 was 105.5 million euro, compared with 111.1 million euro in 2010. The EBIT margin was 7.0% (7.5% in 2010).

Profit before tax in 2011 was 79.3 million euro (83.8 million in 2010).

Consolidated net profit in 2011 was 47.0 million euro, an improvement of 9.8% from 42.8 million in 2010.

2011 financial operations showed net financial charges of 28.7 million euro (32.5 million euro in 2010).

In 2011, the Piaggio Group reported a significant increase in capital expenditure – in particular for the expansion of Group industrial operations in the emerging countries – for a total of 126.1 million euro, up by 31.1% from 96.2 million euro in 2010. Of the total, 38.3 million euro were in the R&D area, which also reported expenditure of 30.2 million euro.

Consequently, R&D expenditure and investments in 2011 increased by 8.9% from 2010. Work concentrated in particular on the development and industrialisation of new engines featuring some of the lowest emission and fuel consumption levels anywhere in the world.

Consolidated net debt at 31 December 2011 was down to 335.9 million euro, a reduction of 14 million from 349.9 million euro at 31 December 2010. The improvement in the net financial position was largely due to the positive trend in operating cash flow and positive management of working capital, enabling the Group to self-fund a larger investment program and also distribute dividends for an amount of 25.7 million euro and buy back shares for approximately 9.1 million euro.

Shareholders' equity at 31 December 2011 totalled 446.2 million euro, from 442.9 million euro at 31 December 2010.


* * *

Events after 31 December 2011

On 6 January 2012 the Vespa scooter developed for the Indian market was presented at the Auto Expo show in Delhi, Asia’s main motor show. Powered by a new low-emission fuel-efficient Piaggio engine with a capacity of up to 60 km/litre, the scooter will be produced in the Piaggio plant in Baramati (India) and begin shipping in April in India’s 35 largest cities. Initial production capacity is 150,000 vehicles/year.

On 23 January 2012 the 130 million euro syndicated revolving line of credit arranged on 29 December 2011 was finalised. Specifically, early repayment was made of the syndicated loan for a residual amount of 65 million euro with final maturity in August 2012, and early cancellation was requested for the 100 million euro credit maturing in December 2012, on which no drawings have been made.


* * *


The Piaggio Group 2011-2014 Business Plan envisages strong growth in productivity to generate value for customers, employees and shareholders by leveraging the Group’s growing international presence, and boost product cost competitiveness on key processes like procurements, manufacturing, design.

In terms of the business and geographical areas, the Plan sets out a growth strategy consistent with the world economic scenario, targeting decisive expansion on the emerging high-growth markets, accompanied by the maintenance and consolidation of the Group’s leadership positions on the mature markets.

Specifically the Plan envisages:

  • in the Asia SEA area, the expansion of the engine and two-wheeler ranges, as well as completion of entry on to the Indonesian market and new Asian markets, assisted by an increase in production capacity at Piaggio Vietnam (300,000 vehicles/year compared with today’s 140,000 vehicles/year);
  • entry on to the Indian scooter market, where annual growth rates are high, with the Vespa premium brand; Vespa production will begin during the first quarter of 2012 in the new Baramati facility with an initial production capacity of more than 150,000 vehicles/year;
  • on the mature Western markets, further consolidation of the Group’s European leadership on the two-wheeler market as a whole and in the scooter sector, and growth in sales and margins for motorcycles thanks to the Aprilia and Moto Guzzi ranges;
  • in commercial vehicles, higher sales and market share in India (in part through the introduction of new 3- and 4-wheel vehicles in the fastest growing market segments) and in the emerging countries, maintenance of current market positions in Europe, and further growth in exports to African, Asian and South American markets.

As far as technology is concerned, the Piaggio Group is focusing strongly on the development – for two-wheelers and for commercial vehicles – of new highly innovative combustion engines, with sharply reduced fuel consumption and emissions. Supported by cooperation among the Group R&D centres in Europe and Asia and the world’s leading universities, Piaggio will also continue development work on vehicles equipped with new-generation electric motors, as well as hybrid engines, a field where the Group is already one of the world’s most advanced manufacturers.

Consistently with the Group’s increasingly global industrial and commercial organisation, strong emphasis will also be given to development of an international system of expertise and research in product marketing and style, with Group centres in Europe, Asia and the USA bringing together the top designers and marketing specialists from all Piaggio Group locations around the world.


* * *

Piaggio & C. S.p.A.

The parent company reported 2011 net sales of 948.1 million euro and a net profit of 47.0 million euro.

Proposed dividend of 0.082 euro

The Board of Directors will ask the shareholders' meeting to approve distribution of a dividend of 0.082 euro per ordinary share (compared with a dividend of 0.07 euro for 2011), not including the quota for remaining own shares pursuant to art. 2357-ter Italian Civil Code, for a total amount of € 29,892,998.24. The ex dividend date will be 14/05/2012, with payment on 17/05/2012.


* * *

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.


For more information:

Piaggio Group Press Office

Via Broletto, 13

20121 Milan

+39 02 02.319612.15/16/17/18




Consolidated Income Statement

    2011   2010
    Total of which related parties (Chapter F)   Total of which related parties (Chapter F)
In thousands of euro Note          
Net sales 4 1,516,463 1,674   1,485,351 711
Cost of materials 5 904,060 38,786   881,075 40,584
Cost of services and use of third-party assets 6 266,484 3,817   258,358 6,057
Employee expenses 7 247,600     240,115  
Depreciation property, plant and equipment 8 35,219     35,879  
Amortisation intangible assets 8 59,794     50,127  
Other operating income 9 122,562 502   121,128 3,279
Other operating expense 10 20,323 14   29,821 43
EBIT   105,545     111,104  
Share of result of associates 11 2,481     5,252  
Finance income 12 4,087     2,891 3
Finance expense 12 31,853 305   33,905 347
Net exchange-rate gains/(losses) 12 (932)     (1,518)  
Profit before tax   79,328     83,824  
Income tax 13 32,305     40,983 0
Result from on-going operations   47,023     42,841  
Discontinued operations:            
Profit or loss from discontinued operations 14          
Net profit (loss) for the period   47,023     42,841  
Attributable to:            
Equity holders of the parent   47,053     42,811  
Minority interests   (30)     30  
Earnings per share (in €) * 15 0.126     0.113  
Diluted earnings per share (in €) * 15 0.126     0.112  


Consolidated Balance Sheet

    At 31 December 2011      At 31 December 2010   
    Total of which related parties (Chapter F)   Total of which related parties (Chapter F)
In thousands of euro Note          
Non-current assets            
Intangible assets 16 649,420     652,622  
Property, plant and equipment 17 274,871     256,759  
Investment property 18          
Equity investments 19 2,482     194  
Other financial assets 20 11,836     334  
Non-current tax receivables 21 976     967  
Deferred tax assets 22 55,726     46,294  
Trade receivables 23          
Other receivables 24 15,165 405   12,655 443
Total non-current assets   1,010,476     969,825  
Assets held for sale 28          
Current assets            
Trade receivables 23 65,560 2,453   90,421 2,210
Other receivables 24 28,028 6,456   23,300 5,983
Current tax receivables 21 27,245     44,200  
Inventories 25 236,988     240,066  
Other financial assets 26 0     23,051  
Cash and cash equivalents 27 151,887     154,859  
Total current assets   509,708     575,897  
TOTAL ASSETS   1,520,184     1,545,722  



    At 31 December 2011      At 31 December 2010   
    Total of which related parties (Chapter F)   Total of which related parties (Chapter F)
In thousands of euro Note          
Shareholders' equity            
Share capital and reserves attributable to equity holders of parent 31 445,036     441,277  
Share capital and reserves attributable to minority interests 31 1,182     1,613  
Total shareholders' equity   446,218     442,890  
Non-current liabilities            
Borrowings due after one year 32 329,200 2,900   371,048 2,900
Trade payables 33 235     88  
Other non-current provisions 34 12,429     16,993  
Deferred tax liabilities 35 32,735     32,338  
Pension funds and employee benefits 36 46,603     58,636  
Non-current tax payables 37 2,539     3,361  
Other non-current payables 38 5,948     4,202  
Total non-current liabilities   429,689     486,666  
Current liabilities            
Borrowings due within one year 32 170,261     156,800  
Trade payables 33 375,263 18,903   352,627 12,857
Tax liabilities 37 20,920     19,290  
Other current liabilities 38 64,718 75   69,503 342
Current portion of other non-current provisions 34 13,115     17,946  
Total current liabilities   644,277     616,166  
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