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Piaggio Reports First Half 2011 Results

Wed, 27 Jul 2011

The Piaggio Group reported slight increases in net sales and net profit over the first six months of 2011 compared to the same period in 2010.

Net sales increased 1.1% to 830 million euros (US$1.19 billion) over the first six months of 2011, compared to 820 million euros (US$1.18 billion) in the first half of 2010. Piaggio reported a net profit of 33.3 million euros (US$47.9 million), a slight increase from the net profit of 33.1 million euros (US$47.6 million) reported last year.

Piaggio reported an 18.8% increase in motorcycle sales, though those gains were overshadowed by a decrease in scooter sales. Piaggio generated 102.1 million euros (US$146.8 million) from motorcycle sales, compared to 85.9 million euros (US$123.5 million) in 2010. Piaggio attributed the growth to strong demand for Aprilia and Moto Guzzi models.

Scooter sales however dipped to 397.0 million euros (US$570.6 million) compared to net sales of 421.3 million euros (US$605.5 million) in 2010.

Piaggio shipped 24,700 motorcycles and 203,000 scooters in the first half of 2011, compared to 24,300 motorcycles and 208,500 scooters in the same period of 2010. The Asian market accounted for 37,200 units, a 25.7% increase from 2010. Those figures are expected to continue growing thanks to the opening of new Vespa flagship stores in Taiwan and Malaysia and an announced expansion into Indonesia, the world’s third largest two-wheeled vehicle market.

[Source: Piaggio]

The Piaggio Group: First Half 2011

Net sales € 830.0million (€ 820.8 mln in H1 2010)
EBITDA € 120.3 million (€ 117.5 mln in H1 2010)
EBITDA margin up to 14.5% (14.3% in H1 2010)
EBIT € 75.0million (€ 74.6 mln in H1 2010)
Net profit € 33.3 million (€ 33.1 mln in H1 2010)

346,500 vehicles shipped (340,800 in H1 2010)

Net debt € 332.1million (down from € 349.9 million at 31.12.2010 and € 341.7 million at 30.06.2010)

Milan, 27 July 2011 –At a meeting today in Mantua chaired by Roberto Colaninno, the Board of Directors of Piaggio & C. S.p.A. examined and approved the half-year report at 30 June 2011.

The Piaggio Group’s results for the first six months of 2011 reflect improvements in all the main business and financial indicators and confirm the importance of the decisions made by the Group to strengthen its industrial and commercial operations in the world’s fastest-growing regions.

In the first six months of 2011 the Piaggio Group shipped a total of 346,500 vehicles motorcycles, scooters and commercial vehicles – – reporting a 1.7% increase involumes compared with 340,800 vehicles sold in the first half of 2010.

Group consolidated net sales also increased,reaching 830.0 million euro in the first half of the year, an improvement of 1.1% from 820.8 million euro in the year-earlier period. Net of the exchange-rate effect, net sales improved by 3% from the first 6 months of 2010.

Consolidated EBITDA rose to 120.3 million euro for the first half of 2011, an increase of 2.4% from 117.5 million euro in the year-earlier period. The EBITDA margin also strengthened,to 14.5% (14.3% in the first half of 2010).

The Group also reported an YoYimprovement in EBIT performance in the first half, with consolidated EBIT at 75.0 million euro, an increase of 0.4 million euro from the first six months of 2010.

The first half of 2011 closed with a consolidated net profit of 33.3 million euro –asmall increase from 33.1 million euro in the year-earlier period –after tax for the period of 28.5 million euro (46.1% of profit before tax).

The net financial position at 30 June 2011 stood at -332.1 million euro, a significant improvement from -349.9 million euro at 31 December 2010, and -341.7 million at 30 June 2010.

Shareholders’ equity at 30 June 2011 amounted to 442.2 million euro, compared with 442.9 million euro at 31 December 2010 after distribution ofdividends for 25.7 million euro.

Looking at performance in the various geographical and business areas , in the two-wheeler business market conditions were particularly complex in Italy and Europe. In the EMEA area, the two-wheeler market slackened by around 7% in the first half of the year: within the area, the Piaggio Group confirmed its position as European leader in scooters, raising its market share to about 27.3%. The Group also maintained its leadership in the USscooter sector with a share of 24.6%; the US market showed signs of an upturn in the first half of 2011 with an improvement of approximately 1% (+28% in scooters). The Group turned in a particularly strong performance on the two-wheeler market in the Asia Pacific region (37,200 shipments, +25.7% from the first half of 2010), thanks to the success of its operations in Vietnam and the first results of its move on to important new markets in South East Asia.During the first half the Group commenced sales operations in Thailand, after opening its first Vespa flagship stores in Taiwan and Malaysia at the beginning of the year, and in June announced its entry into Indonesia (the world’s third-largest two-wheeler market after China and India) with the subsidiary PT. Piaggio Indonesia, which began operations in July. In the first six months of 2011, the Group also reported significant progress in motorcycles thanks in particular to the newAprilia andMoto Guzzi models –withoverall growth in worldwide sales volumes and turnover (102.1 million euro in the first half of 2011, +18.8% from the first halfof 2010).

Incommercial vehicles, the Piaggio Group closed the first half with totalshipments of 118,800 vehicles. On the European market the Group sold 7,400 vehicles, in the first six months. On the Indian three-wheeler market, Piaggio Vehicles Private Limited confirmed its role as the primary player with a market share of 38.3%. Sales of three-wheelers in India in the first half amounted to 106,028 vehicles (from 95,045 vehicles in the first half of 2010), an increase of 11.6%, in line with the growth of the Indian three-wheeler market.

Significant events after 30 June 2011

After the meeting of the Board of Directors on 13 July 2011 –which approved the issue of longterm debt securities for an overall nominal amount of 75 million US dollars – on 25 July Piaggio & C. S.p.A. closed a US Private Placement of Senior Unsecured Notes for 75 million US dollars, subscribed in full by an institutional investor, with final maturity after 10 years and a 6.50% coupon. The proceeds will be used to refinance Piaggio debt by improving its exposure profile, through an extension of average maturity and a further differentiation of its lender base.


In the second half of 2011, the Piaggio Group will continue to pursue its strategy to expand its industrial and commercial presence on the main Asian markets, strengthening its leadership on the Indian light commercial vehicle market and boosting market share in scooters in Asia Pacific. The Piaggio Group will begin a decisive new phase of growth in Asia, which will bring an important expansion in its industrial and sales operations throughout the region, targeting revenues of approximately 1 billion euro on the Asian markets within four years. Piaggio Group R&D will focus on the renewal of the product range –scooters, motorcycles and commercial vehicles –with special attention to development of fuel-efficient engines with low/zero environmental impact. *** 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.

By Dennis Chung

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