Good afternoon, everyone, and welcome to the Ferretti Group First Quarter 2025 Results Webinar. Thank you all for joining us. We appreciate your time and interest in Ferretti Group as we share an overview of our performance over the past quarter and discuss the outlook for the future. Before we begin, let me introduce our speakers: Mister Alberto Galassi, Chief Executive Officer; Mister Marco Zammarchi, Chief Financial Officer; and myself, Margherita Sacerdoti, Investor Relator. Today's agenda will cover key highlights from the first quarter, business dynamics, and financial results, followed by a Q&A session. Throughout the webinar, you may submit your written question using the Q&A function in the Zoom menu. We will address as many as possible at the end of the presentation. You can also ask oral questions by using the raise-your-hand feature in the Zoom platform. With that, let me hand it over to Mister
Alberto Galassi to get us started. Mister Galassi, the floor is yours.
[Foreign language] Alberto Galassi speaking, CEO Ferretti Group. [Foreign language] good morning, actually good afternoon. Quietly proud, I would say, very proud of presenting to you the best quarter results ever in the history of Ferretti Group. We have sound performances on all the indicators, starting from an incredible record high number of EUR 1.8 billion of order intake, order backlog. The order backlog is increased by 7.6% versus the first quarter of the previous year at EUR 1.769 billion, so nearly 1.8. Order intake grew as well, 1.5% to the number of EUR 271 million compared to EUR 267 million of the previous year. The marginality of the company increased from 15.4% of the first quarter of 2024 to 16% of the first quarter of 2025. The revenues of the company from EUR 313 million to EUR 329 million grew by 5%.
This is an important number because the market growth expectation was about 4.2%, and it's not our number. It's an effect; there's a Phil Draper Associates database available at the end of 2024, which is a very reliable and independent source. Two numbers on this page have to be, in my opinion, highlighted more than others. Marginality for sure, but very important is the record high order backlog, and very, very important also the revenues, which are higher in growth than the expectation of the market. The dynamics of the business, interesting. We have a lot of signals that can tell us how the situation is all over the world. Never forget the Ferretti Group sells in 71 countries all over the world.
Starting from the season in the U.S., we had an interesting and very, actually excellent boat show in Palm Beach in the United States from the 19th to the 23rd of March, where we have the growing number of visitors compared to the previous year. Also Dubai, completely two different areas of the world in the same time frame, are giving us some indicators. The indicator is that the U.S. was waking up after being silent during the election time. Dubai is a very important market. The Middle East is becoming a very prominent market for all of us. This is also the signal we receive, the same signals from Singapore and from Sydney. Again, the market, I would say, at the beginning of the season is showing different speeds according to different countries.
I would say on the overall, especially for some measures from some kind of boats, there's a lot of interest, which is never slowing down at all, namely from Made-to-measure, so from 24 m 27 m up to 45 m boats. We keep investing and producing and bringing into the market new models. Riva flagship brand presented the Iseo Super, seven units sold. There is an update also Ferretti Yachts 940 will be officially presented at the Venice boat show on the 28th of May with seven units sold. A product that we never had in the range, the Pershing GTX 70 with one unit sold. I can tell you that we delivered a 63 m AMOR À VIDA, is a one-off product, of course, built in the CRN Line and Super Yacht Division in Ancona.
Other three products we announced and two are a range expansion. We will present in Sarnico, the headquarter, the historical site of Riva on the 27th of June, the Riva 58' Capri. The Ferretti Yachts 800 will be presented during the summer. Interesting news is that we are investing now and revamping the brand Itama. Itama is a brand that's been silent with models which we never invested in for about 10 years. Now we see that for these runabouts, there is interest growing up. Now Itama is representing only 1% of our revenues. With the new range of models, Itama 54 is the first one of the new range of models that will be released in the market in the next few years. It will bring us up about 4%. I'm stepping down for Margherita. He's going to give you some.
There's a video.
Sorry, there's a video. Interesting. There's a video of the new Itama, how it fits in the Itama range. Margherita, order backlog and net backlog.
Thank you, Mister Galassi. We start with the order backlog and net backlog. As Mister Galassi mentioned, we reached a new high record number of EUR 1.8 billion in the order backlog. Also, the net backlog grew by 1.3% compared to the first quarter of 2024. As of March 31st, we already secured 60% of our 2025 guidance, considering the first quarter revenues and the current net backlog. In the first quarter, we collected EUR 271 million of orders that correspond to 48 units. In the same period, we delivered 31 units. This level of order backlog was reached thanks to the order intake that also grew compared to last quarter by 1.5%. If we consider the book-to-bill ratio, including and excluding the Composite segment, we are still above 1.0x.
As of today, also very important to mention that negotiations are happening and the level of negotiation is comparable to the one of last year, so around EUR 360 million. If we look at the order intake by segment, we can see that the Composite Yacht was nearly flat, slightly down, mainly reflecting a softer U.S. season that we already mentioned in the fourth quarter of last year. It continued in the first quarter of this year because of the economic uncertainty that impacted the small-size yacht segment in America. At the same time, we see an incredible growth of double-digit in Made-to-measure Yachts, also in America. We will see it later in all geographies. The weight of Made-to-measure over the order intake now is about 49%. When if we look at last year, we see it was 37%, and in 2023, it was 39%.
The weight of Made-to-measure is growing following the strategy of focusing more and more into this segment. The Super Yacht is, of course, especially if we look at just one quarter, can be affected by a single order. In the first quarter of 2024, we had a one-off that, of course, is impacting the comparison with this year. It is very important to remind you that our Super Yacht is doing very well. We have been adding new orders in the second half of last year, growing. We are filled up until 2029. We do not have any slot available. If we move into the geographic breakdown, we can see that Europe performed down compared to last year. This is exactly because of the bespoke that we collected in the first quarter of 2024 that was in Europe. It was a one-off of EUR 64 million.
If we take that out, comparing apples with apples, Europe would have performed positively with +33% compared to last year. The Middle East is also having a tough comparison with the first quarter of last year because the first quarter of 2024 was the best quarter in the region of the entire year. This year is a bit suffering the comparison. APAC is showing an increase of almost EUR 10 million from one of last year to 11 of 2025. The Americans, you can see, are showing a great performance, +150% in the Made-to-measure segment. This is just the Made-to-measure. As we said, the Composite Yacht was a bit slow because of the uncertainty, because the season is over. Just to remind you, the Composite Yacht is a kind of purchase that clients tend to do in the season.
While Made-to-measure, it's continuing to perform very well. I hand it over to Mister Galassi.
Let me add something here. The business model of Ferretti Group, of being present in 71 countries and not focusing on some markets more than others, with never, I would say, one nation or one country that plays an important role in our revenues and order intake, is a very, it comes and it transforms in a balance. There's always a balance from one market that goes down and one market that goes up. Also in the product range, never underestimate the superpower of having seven different brands, not overlapping one with each other. It's difficult to do it, but it pays off because clients are not the same. The age of the clients is not the same. The needs of the clients in different geographic areas are not the same.
Having a portfolio of products which basically can satisfy any kind of demand and having a capillary distribution network in 71 countries, it ends up having a fantastic balancing between countries and regions. You can see quarter by quarter how, I would say, our sustainability, our, I would say, resilience, and if not, I would say even our growth is driven by the fact that we are very, very, extremely, I would say, well balanced. Sorry, Margherita.
Thank you. I'll hand over the microphone to Mister Marco Zammarchi for the revenues.
Thank you. Good afternoon. Revenues are increased by 5% versus prior year, reaching the amount of EUR 329 million. The reason behind it was because of the solid order backlog that we built in the prior year with the contribution of the order that we took in the first quarter of this year, and especially in the segment of Made-to-measure and Super Yacht. Especially in the following page, we'll see the impact of this revenue, more focus on Made-to-measure that gave us the increase of 60 basis points. In fact, we are showing, we are sharing with you a result in terms of EBITDA of EUR 53 million. That is a 16% EBITDA margin versus 48% of prior year and 15.4%. The rationale behind this increase is especially driven by product mix. The biggest contribution of bigger size, high Composite and Made-to-measure that led to this result.
Also in terms of net profit, we have the similar trend with a growth of 7.7%. If we move to the CapEx activity, we see that the comparison versus prior year is quite dramatic with EUR 16 million of investment and equally distributed between new products and expansion and maintenance. For 2025, what we expect is to be below EUR 90 million because we have almost completed our CapEx plan. This year, we will complete the investment of Ravenna. EUR 26 million remains to be expanded for a total investment of EUR 144 million for a company that still has a utilization rate of our production capacity over 90%. We are happy of this trend that, as we said before in the previous communication, the CapEx plan is finished and this will contribute a lot to the cash generation of the company.
In terms of net financial position, we are still positive. We have, at the end of first quarter 2025, EUR 55 million in terms of net cash. On the other hand, the net working capital was increased to 17.5%. The reason behind the growth of net working capital, it was our stock of Composite Yachts ready for sales in the Americas. We already shared with you that the previous season, so the American season between October 2024 and March 2025, was impacted by some political and economic uncertainties. That is the reason why it is a temporary delay of the release of capital. Yeah, in fact, but it is the nature of the business, just to give you a highlight, if I take into consideration if we have to follow the cut-off rules, in the first 10 days of April, we have collected more than EUR 80 million.
If we expand our view to the end of the second quarter of 2025, after the distribution of dividends of above EUR 33 million, we expect it to be in the range between EUR 95 million and EUR 100 million because of the seasonality, because of the release of the working capital and so on. We expect that we go to a more normal, more stable situation in terms of working capital management for the rest of the year. Mister Galassi, final remarks to you.
The annual guidance 2025, we expect a sustainable mid-range single-digit growth from 4%-5.7%. We expect the net revenues to be EUR 1.22 billion-EUR 1.24 billion, adjusted EBITDA from EUR 190 million to EUR 201 million-EUR 207 million. We grow in the high single digit from 5.8%-8.9%.
The EBITDA margin from 16.2% to 16.5%-16.7%, so from 30 basis points to 50 basis points. The CapEx, which is very important because the cycle of CapEx is nearly finishing in our company, from EUR 140 million to EUR 90 million, or even less than EUR 90 million. Again, it is growth. As you can see, the revenues are growing higher than the market. As they say, it was around 4.2% in line with the quarter expectations, the fourth quarter numbers that we released. We are all here for any question that you may have.
Thank you for listening to our first quarter 2025 presentation. We are now ready to start the Q&A session. We will start by oral questions, moving then to the written question. The first question is from Emanuele Gallazzi from Equita. Emanuele, you can unmute yourself and ask the question.
Hello, everybody. Hope you can hear me.
Yes.
Okay. Thank you for the presentation. I actually have three questions. The first one is on the U.S. market. Basically, we have seen a strong demand for Made-to-measure Yachts in the first quarter while somehow weak performance for the Composite Yachts. Can you just discuss a little bit more about the current U.S. environment and how do you see demand in the U.S. evolving from now on? The second one is on basically the guidance. If you can just provide, let's say, a sort of indication on the order intake target for 2025. The last one is on the working capital. I understand that you expect a normalization from the second quarter. Can you just give us an indication on the target working capital sales for 2025? Where do you expect to end it this year? Thank you.
Okay, let me reply to the first one, and then I'll give Marco replying to the second. U.S. market, U.S. market is the Beatles, you should call it the magical mystery tour, because we had the election last year and we had an incredible division in the market between Composite and Made-to-measure. 49% of our sales in the U.S. has been in that quarter of Made-to-measure. Let me remind from 30 m- 45 m in Composite. Then we had the month of April, where everything, as you can imagine, in the world was frozen, not necessarily because of our industry, let's be honest, because Made-to-measure boats and Super Yachts, they do not have American flag. The delivery happens sometimes, most of the times, if not always in Europe, and which are not going to be affected by tariffs.
Small yachts will are, but our clients, any business in the world has been on standby, on hold to understand what's going on in the future. America, did it make any difference? Actually, on the contrary, we had opportunities for some clients that had the boats already in the U.S. that, fearing for tariffs, they went to buy and release in the stock in the month of April. We had sales in the month of April in the United States of America. How do I see the market? Much better now. We had the last quarter froze a little bit by the election timing. We started very, very well. End of March, beginning of April, frozen again because of the tariffs. Then again, picking up in the month of May.
I should be a future teller to tell you exactly how the U.S. market is going to go. The feeling I have talking to the competitors, the feeling I have talking to luxury goods manufacturer for the U.S., we have a couple of advantages for the U.S. that others do not have. Let's make the first one. We do import ourselves our boats. We can leverage on the transfer price of the boats. If the tariffs will ever apply, we can manage it a bit. Some clients are ready for some top brands to pay an extra in order to have that kind of specific brand and that kind of specific boat. Definitely, if 25% at the beginning of the negotiation was in place for yachting coming from Europe, you cannot expect the client to pay 25%. There are some countermeasures that we do.
On the other hand, we do not import anything from the U.S. fundamental. We do import Seakeeper stabilizers, which is a kit that is EUR 50,000 EUR 70,000 EUR 100,000. In the boat, it's nothing. I am positive. I am positive because I see that my clients, our clients, U.S. clients, European clients are not anymore fearing the uncertainty, the total darkness of what it looked like in the month of April. Will they have a fallout in the U.S.? I'm expecting it to have it. Month of May, it's saying, yes, we are recovering in the U.S. as well. Did I reply?
Yes.
Now, Marco.
About the guidance on orders, what we expect is to have an order inflow very similar to the prior year, so slightly better in every segment. Maybe we could be a little bit more conservative for Super Yacht because the availability of a slot, so the production capacity. The trend that we have seen in the first quarter and also, let's say, one month and a half till today, they give confidence to us to have this result in mind. Slightly better than prior year achievement. About the working capital, instead, as I said, it was that across the quarter, there is a little bit of seasonality. What we expect is to continue this seasonality, but to follow this seasonality, but with a different trend.
For example, the Q3, if you see the comparison between second quarter 2024 and third quarter 2024, we have a sharp decrease of liquidity. In this year, given the stock that we have available, this decrease will be quite less. In a nutshell, we expect to be at year-end in high single-digit ratio, so below 10%. This is the expectation for 2025. We are adjusting our production approach for the Composite in order to reduce the absorption of working capital for this kind of production.
Very clear. Thank you.
The next question is from Niccolo' Storer from Kepler. Niccolo', you can unmute yourself.
Hello. Thanks for taking my questions. Can you hear me?
Yes.
Can you hear me?
Now, yes.
Okay. Thanks for taking my questions. Again, on your assumptions backing your guidance, you said, Marco, that you expect slightly better intake in any segment. Making a couple of calculations, it seems to me that in reality, you'd need very strong growth in Composite segment to get to your guidance. Otherwise, it's probably going to be difficult to get there. A comment on that. Maybe are you assuming accelerating the execution on Made-to-measure or Super Yacht to get there? The second question is on the seasonality of the Composite market. I was wondering if what we have seen in 2024 and 2023 can be taken as a usual seasonality of that market, meaning a strong Q1, a weak Q2, and Q3 and Q4 in between. Thank you.
Okay. About the order intake, yes, we expect the slight growth. To be more precise, the growth that we have to expect is mostly on Made-to-measure. We expect still a growth on Composite. Composite, first of all, now, currently, we are in the peak season of EMEA market, so Europe and Middle East. As far as we are experiencing right now, we see that the boats that are made available for the season, we have a lot of negotiation in progress. We have already sold most of them. The competitors are quite aggressive in terms of pricing, but we are still confident to do it. On the other hand, you see that if we compare quarter by quarter, I mean, EUR 104 million of 2024 versus EUR 101 million of first quarter 2025, we have to recover something more to be in line with what I said.
We see the market is there, very aggressive. Usually, we talk about Composite, but Composite inside has two subsegments. The entry level, or better, three segments for us, because they are the iconic models, so the small Riva and the small Wally that has not any problem at all. We have the high Composite, so the boat over 80 footer till 100 footer that they are performing like Made-to-measure. We are suffering a little bit on the so-called entry-level model where we are competing with other players. This is the point of attention for us. In general terms, we are quite confident to be in line with the prior year result for this segment. The second part of your question about the seasonality of the Composite market, okay, partially I told you comparing 2024 and 2025.
We know that the second quarter and the third quarter of 2024 were a little bit affected by the U.S. season. This year, we have not anymore the threats of the U.S. election. We expect some seasonality as usual, but we are quite confident to reach the target. Very focused, very committed, but not big threats about it.
Let me add something on the general picture. What we faced, all of us in the world, was a reality shock in the month of April. What I can tell you now, after the reality shock, things are going back to normal. The season is starting, the sunshine is shining. Don't ever underestimate for the small boat a superpower of a good season. We have a lot of inquiries, a lot of negotiations, and a lot of contracts. I would say things are normalizing and worries are behind our shoulders. To summarize.
Thank you.
The next question is from Adrien Du verger from Goldman Sachs. You can unmute yourself, Adrien.
Hi, thank you very much for taking my questions. The first question would be if you could comment on the current trading in April and early May and how that compares to the fourth quarter in the different regions. My second comment would be on the progress you've made in the Ravenna facility. How far away are you from a fully operational shipyard? The third question would be on the M&A pipeline and then potential acquisition and expansion of factories. I think you had mentioned at the last call that you were looking at several options. Is that still the case? If you can comment a bit further on this. Thank you very much.
Thank you for the question. I can tell you April and May, different months. April, tariff news, breaking news all over the media, stock exchange falling down, the planet falling apart. There were some sales in the U.S. Why? Because clients said the opportunity, no, I do not want to know what is going to happen in the future. I have the boats here. I like the boat. And two units were sold in the U.S. in the month of April because they were already American there. No risk of tariffs on that. May, different market. May, the market is back to normal completely, global. If you ask about regions, it is global. It is from Asia-Pacific to the United States to Europe to the Middle East. Totally and completely, the world is back. Customers are inquiring, negotiations are pending. The dealers are working.
Our sales network are basically never at home because the global demand is back. [Foreign language]
On the second one, it was about the CapEx activity, right?
I can say about Ravenna. I don't know if you're asking about Ravenna.
Yes.
We talked about it before. The CapEx plan for Ravenna is nearly finished with a small portion to be completed by the end of this year. The utilization rate of our total production capacity is over 90%. We are in line with the rationale of our CapEx plan. We have to grow in terms of size. Now, with 90%, we are safe and we can continue to grow step by step. Again, according to our plan, we do not need to build up more units, but larger units. We are satisfied with the CapEx plan. We do not expect major intervention on next years in order to fulfill our midterm guidance. This is if we consider the company in the same perimeter. Let's move to M&A.
M&A, I can tell you that we are entering soon in a due diligence process, no more than that. The plan is we are on time. We would like to start a due diligence. Actually, we will start a due diligence for an interesting asset. That is the only thing I can tell you right now.
Thank you very much.
Now, let's move to the written question. The first one is about CapEx. Can we expect it to drop further to EUR 90 million in 2026? Is somewhere between EUR 50 million and EUR 70 million a reasonable assumption?
The answer is yes, because as we said, now we are at 90% utilization rate. If we expect to grow every year of a certain quantity, but in terms of size and not in terms of units, we believe that if we consider the company in the same perimeter, we do not need to be in this range. Practically, we expect to be in the range of 5% 6% of total investment on revenues, no more than that.
A follow-up of this question is about working capital. You mentioned you expect it to be around just below 10%, but that's still quite elevated considering it was already around 10% at the end of 2024. Another way to frame the question, last year, working capital had a -EUR 159 million impact on free cash flow. How much of that do you expect to reverse this year? Do you anticipate working capital to be a source of cash inflow in 2025? If so, by roughly how much?
As we said, we expect by year-end to be below 10%, in the range of 10%, slightly below. The working capital dynamics is strictly linked to the dynamics of Composite Yacht because Super Yacht operations are by definition negative as working capital, and Made-to-measure are neutral. It depends, as anticipated before, on the dynamics of Composite Yacht. We are reviewing right now the production approach to this segment in order to squeeze the production time, or in other words, to delay the decision time in order to be ready for the season. This is the approach that we have. This takes time. We expect to be in 10% of working capital at the end of 2025 and step by step to be back to 5% unless the market trend in this moment.
We took benefit in the prior year of the huge backlog also on Composite, but this market in this moment is not with us anymore. We have to face the reality, and we have to be quite reactive in adjusting ourselves to the new market dynamics.
The last question is about the share buybacks. If we can just give an update on that.
Buyback of the shares as MIP management incentive plan for the management is on the table. It's still going on the discussion. This morning, we had the board. We had a conversation on the matter, so it's not over. We will keep you posted on the we will be announced whenever it's ready.
I do not see any more questions. Thank you, everybody, for joining the Q1 2025 conference call and have a good weekend.
Thank you very much.
Thank you for your time and attention.
Thank you.
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