DMH Bank of America

Ducati Motor Holding Announces 2005 First Quarter Results BOLOGNA, Italy, May 13 /PRNewswire-FirstCall/ -- 1Q05 1Q04 Var% Revenues 85,1 100,3 -15,1% EBTIDA 8,5 12,3 -31,4% Profit/loss (pre-tax) (1,0) 0,8 na Net Debt (122,3) (121,2) -0,9% Million euro Ducati Motor Holding S.p.A. (NYSE:DMHNYSE:BorsaNYSE:ItalianaNYSE:S.p.A:NYSE:DMH), a leading manufacturer of high performance motorcycles, today announced financial results for the first quarter ended March 31, 2005. For the first quarter of 2005, revenues were Euro 85.1 million, down 15.1% including forex effects (or down 12.4% excluding forex effects) over the same period in 2004. The fall was mainly due to a 5.3% decrease in unit sales, a negative bike mix, a decrease in accessories and apparel sales, and continuing adverse forex effects. Revenues from Ducati motorcycles for the period decreased 14.0% to Euro 68.8 million and represented 80.8% of total revenues. Motorcycle-related products, including spare parts, accessories and apparel, decreased 16.8% to Euro 15.7 million over the comparable period in the previous year. Gross margin was 32.2% of revenues including forex effects (or 34.2% excluding forex effects) versus 35.9% during the same period a year ago. EBITDA was Euro 8.5 million, down 31.4% including forex effects (or 14.9% excluding forex effects) and accounted for 10.0% of revenues, versus 12.3% in the same period last year. Pre-tax profit for the Ducati Group was a loss of Euro 1.0 million in the first quarter of 2005, compared with a profit of Euro 0.8 million in the first quarter of 2004. Unofficial Ducati worldwide registrations, an indication of retail sales, were down 16% versus last year's first quarter. Registrations were up 8% in the US and 1% in the non-subsidiary countries, while decreases were recorded in France down 5%, Italy down 23%, Germany down 23%, Japan down 31%, Benelux down 36% and the UK down 36%. The Company's net debt as of March 31, 2005 was Euro 122.3 million, in line with the Euro 121.2 million on the same date a year earlier, and up versus Euro 116.2 million as of December 31, 2004. The company's gearing ratio was 82% as of March 31, 2005, versus 76% on the same date a year earlier and 78% on December 31, 2004. "Despite the weakness in the market the results of the first quarter of 2005 have been in line with our expectations. However, as expected, 2005 will be back-loaded in terms of sales and bike mix, due to the introduction of the Sport Classic," announced Federico Minoli, Ducati Chairman and Chief Executive Officer. "While registrations were down in January and February, this trend reversed in March and April and shows encouraging signs of continuing." "The upturn we have seen in March and April as well as the 3,000 pre-sold Sport Classics, give us reason to maintain our objectives of a return to profit and a net debt reduction for 2005 ," said Enrico D'Onofrio, Ducati Chief Financial Officer. "Based on results at the end of June, when the peak registration season will be just over, we will have better visibility of full-year results." On March 31, 2005, the Company had re-purchased 3,769,249 shares, equivalent to Euro 4,082,096.67 or 2.37% of its stock capital. First quarter 2005 financial results were approved by the Board of Directors on May 12, 2005. Founded in 1926, Ducati develops racing-inspired motorcycles characterized by unique engine features, innovative design, advanced engineering and overall technical excellence. The Company produces motorcycles in six market segments which vary in their technical and design features and intended customers: Superbike, Supersport; Monster, Sport Touring, Multistrada and Sport Classic. The Company's motorcycles are sold in more than 60 countries worldwide, with a primary focus in the Western European, Japan and North American markets. Ducati has won thirteen of the last fifteen World Superbike Championship titles and more individual victories than the competition put together. For more information about the Company, please visit our web site at http://www.ducati.com/ This press release contains statements that are forward-looking and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those anticipated, as described in documents previously filed by the Company with CONSOB and with the U.S. Securities and Exchange Commission. Ducati Motor Holding S.p.A. and Subsidiaries Net Sales and Shipment Data Three Months Three Months Ended Ended Mar,31 Mar,31 Mar,31 Mar,31 2005 2004 2005 2004 Net Sales (Euro in thousands, US$ in thousands) Motorcycles EUR 68,780 EUR 80,014 $ 89,166 $ 103,730 Spare Parts, 15,657 18,824 20,298 24,403 Accessories, Apparel Miscellaneous Other 702 1,462 910 1,895 Total net sales EUR 85,139 EUR 100,300 $110,374 $ 130,028 Ducati Units Motorcycle % shipments: Change North America 1,710 1,280 33.6% Main European 4,997 5,721 (12.7%) market Japan 513 533 (3.8%) Rest of World 1,745 1,936 (9.9%) Total 8,965 9,470 (5.3%) Motorcycle % product mix: Change Superbike 2,120 2,906 (27.0%) Supersport 259 425 (39.1%) Sport Naked 4,174 4,352 (4.1%) Sport Touring 389 856 (54.6%) Multistrada 2,023 931 117.3% Total 8,965 9,470 (5.3%) Unofficial Motorcycle % Registrations: Change North America 1,431 1,325 8.0% Main European 4,717 6,164 (23.5%) market Japan 494 720 (31.4%) Rest of World 1,238 1,225 1.1% Total 7,880 9,434 (16.5%) Ducati Motor Holding S.p.A. Consolidated Statements of Operations Data (Euro in thousands, US$ in thousands, except per share and share amounts) Three Three Months Months Ended Ended Mar, 31 Mar, 31 Mar, 31 Mar, 31 Percent 2005 2004 2005 2004 Change Net Sales EUR 85,139 EUR 100,300 $ 110,374 $ 130,029 (15.1%) Cost of goods sold (57,743) (64,269) (74,858) (83,318) Gross Profit 27,396 36,031 35,516 46,711 (24.0%) Other operating 5,911 5,835 7,663 7,564 revenues SG&A expenses (24,511) (29,291) (31,776) (37,973) Other operating (324) (234) (420) (303) income Depreciation & (7,743) (9,659) (10,039) (12,522) amortization Operating 729 2,682 944 3,477 (72.8%) income/(loss) Financing expense, (1,642) (1,916) (2,129) (2,484) net Other non-operating (40) (10) (52) (13) income/(expense), net Profit/(loss)before (953) 756 (1,237) 980 (226.1%) income taxes and min.interest Shares outstanding 158,826,407 158,500,963 158,826,407 158,500,963 Percent Other Financial Change Data Motorcycles 9,616 11,238 (14.4%) Produced (Units) Motorcycles Sold 8,965 9,470 (5.3%) (Units) Unofficial 7,880 9,434 (16.5%) Registrations (Units) EBITDA 8,472 12,341 10,983 15,998 (31.4%) EBITDA Margin 10.0% 12.3% Note : On March 31, 200 US$1= 0,7713 Euros Ducati Motor Holding S.p.A. Consolidated Statements of Operations Data (Euro in thousands, except per share and share amounts) Three Months ended Three Months ended March 31, 2005 March 31, 2004 EUR % EUR % Current assets Cash and cash equivalents 28,712 26,168 Trade receivables, net 103,854 106,347 Inventories 98,400 119,129 Other current assets 16,149 24,908 Current assets - Credit Link 15,000 - Total current assets 262,115 55.9% 276,552 55.1% Non current assets Property, plant and equipment-net 60,729 65,089 Intangible fixed assets, net 119,322 122,671 Equity investments 20 12 Non current assets - Credit Link / ABS 10,000 25,000 Other long-term assets 17,045 12,160 Total non current assets 207,116 44.1% 224,932 44.9% Total assets 469,231 100.0% 501,484 100.0% Current liabilities Short-term bank borrowings 95,124 70,884 Current portion of long-term debt 62,742 5,532 Accounts payable - trade 92,237 112,726 Deferred income taxes 3,438 2,105 Income and other taxes payables 8,687 10,393 Other current liabilities 18,858 20,980 Provisions for risks and charges - current portion 4,726 4,824 Total current liabilities 285,812 60.9% 227,444 45.4% Long-term liabilities Long-term debt, net of current portion 7,134 81,890 Employees' leaving entitlement 9,530 8,648 Deferred income taxes 3,173 4,871 Income an other taxes payables - long term portion 1,292 2,583 Other long-term liabilities 11,054 14,075 Provision for risks and charges - long term portion 1,663 2,518 Total long-term liabilities 33,846 7.2% 114,585 22.8% Total liabilities 319,658 342,029 Total Group shareholders' equity 149,553 31.9% 159,455 31.8% Minority interests 20 - Total shareholders' equity 149,573 31.9% 159,455 31.8% Total liabilities and shareholders' equity 469,231 100% 501,484 100% Ducati Motor Holding S.p.A. Consolidated Statements of Operations Data (US$ in thousands, except per share and share amounts) Three Months ended Three Months ended March 31, 2005 March 31, 2004 US$ % US$ % Current assets Cash and cash equivalents 37,222 33,924 Trade receivables, net 134,636 137,868 Inventories 127,566 154,439 Other current assets 20,936 32,291 Current assets - Credit Link 19,446 - Total current assets 339,806 55.9% 358,522 55.1% Non current assets Property, plant and equipment-net 78,729 84,381 Intangible fixed assets, net 154,689 159,030 Equity investments 26 16 Non current assets - Credit Link / ABS 12,964 32,410 Other long-term assets 22,097 15,764 Total non current assets 268,505 44.1% 291,601 44.9% Total assets 608,311 100.0% 650,123 100.0% Current liabilities Short-term bank borrowings 123,319 91,894 Current portion of long-term debt 81,339 7,172 Accounts payable - trade 119,576 146,138 Deferred income taxes 4,457 2,729 Income and other taxes payables 11,262 13,473 Other current liabilities 24,447 27,198 Provisions for risks and charges - current portion 6,127 6,254 Total current liabilities 370,527 60.9% 294,858 45.4% Long-term liabilities Long-term debt, net of current portion 9,248 106,162 Employees' leaving entitlement 12,355 11,211 Deferred income taxes 4,113 6,315 Income an other taxes payables - long term portion 1,675 3,349 Other long-term liabilities 14,330 18,247 Provisionfor risks and charges - long term portion 2,156 3,264 Total long-term liabilities 43,877 7.2% 148,548 22.8% Total liabilities 414,404 443,406 Total Group shareholders' equity 193,881 31.9% 206,717 31.8% Minority interests 26 Total shareholders' equity 193,907 31.9% 206,717 31.8% Total liabilities and shareholders' equity 608,311 100% 650,123 100% Ducati Motor Holding S.p.A. Consolidated Statements of Cash Flow (Euro in thousands) Period ended Period ended 31/03/05 31/03/04 EUR 000 EUR 000 Cash flow generated by operating activities Net profit (loss) for the period (957) 756 Change in cumulative translation adjustment 672 300 Change in minority interests 4 - Adjustments to reconcile net profit (loss) with the movements of funds generated by (used in) operating activities: - Amortisation, depreciation and writedowns 7,743 9,659 - - Net change in employees' leaving entitlements 277 371 Change in operating assets and liabilities - Trade receivables (19,522) (25,926) - Inventories (6,107) (14,355) - Other current assets (1,344) 906 - Trade payables 15,125 23,223 - Other current liabilities 2,922 5,863 - Due to tax authorities 432 764 - Deferred tax liabilities 6 (4) - Other long-term assets and liabilities - - Net cash generated (749) 1,557 by operating activities Cash flow (used in) generated by investing activities (1,294) (2,064) Net change in property, plant and equipment (4,007) (3,467) Net change in intangible fixed assets - - Decrease (increase) in equity investments (47) (64) Other non-current assets (5,348) (5,595) Net cash used in investing activities Net cash generated by operating activities less cash flow used in investing activities (6,097) (4,038) Cash flow (used in) generated by financing activities Change in short- and long-term debt 1,482 22,041 Subscription to (buy back of) bonds - (15,000) Increase in share capital and reserves - - Other non-current financial assets - (808) Net cash (used in) generated by financing activities 1,482 6,233 Increase (decrease) in cash on hand, bank deposits and securities (4,615) 2,195 Cash and cash equivalents, beginning of the period 33,327 23,973 Cash and cash equivalents, end of the period 28,712 26,168 Ducati Motor Holding S.p.A. Consolidated Statements of Cash Flow (US$ in thousands) Period ended Period ended 31/03/05 31/03/04 $/000 $/000 Cash flow generated by operating activities Net profit (loss) for the period (1,241) 980 Change in cumulative translation adjustment 871 389 Change in minority interests 5 - Adjustments to reconcile net profit (loss) with the movements of funds generated by (used in) operating activities: - Amortisation, depreciation and writedowns 10,038 12,522 - - - Net change in employees' leaving entitlements 359 481 Change in operating assets and liabilities - Trade receivables (25,308) (33,610) - Inventories (7,917) (18,610) - Other current assets (1,742) 1,174 - Trade payables 19,608 30,106 - Other current liabilities 3,788 7,601 - Due to tax authorities 560 990 - Deferred tax liabilities 8 (5) - Other long-term assets and liabilities - - Net cash generated (971) 2,018 by operating activities Cash flow (used in) generated by investing activities (1,677) (2,676) Net change in property, plant and equipment (5,195) (4,495) Net change in intangible fixed assets - - Decrease (increase) in equity investments (61) (82) Other non-current assets (6,933) (7,253) Net cash used in investing activities Net cash generated by operating activities less cash flow used in investing activities (7,904) (5,235) Cash flow (used in) generated by financing activities Change in short- and long-term debt 1,921 28,574 Subscription to (buy back of) bonds - (19,446) Increase in share capital and reserves - - Other non-current financial assets - (1,047) Net cash (used in) generated by financing activities 1,921 8,081 Increase (decrease) in cash on hand, bank deposits and securities (5,983) 2,846 Cash and cash equivalents, beginning of the period 43,205 31,078 Cash and cash equivalents, end of the period 37,222 33,924 DATASOURCE: Ducati Motor Holding S.p.A. CONTACT: For further information, please contact: Fabrizio Nardi, Investor Relations, Ducati Motor Holding S.p.A., Via Cavalieri Ducati, 3, Bologna 40132, Italy, Main Tel: +39-051-6413-111, Direct tel: +39-051-6413-213, Direct fax: +39-051-6413-223, E-mail:

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