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UPDATE 1-Vespa-maker Piaggio's sales drop to nine-year low
July 26, 2013 / 1:56 PM / 4 years ago

UPDATE 1-Vespa-maker Piaggio's sales drop to nine-year low

(Adds details from earnings release, shares)

MILAN, July 26 (Reuters) - Italian motorcycle and scooter maker Piaggio’s first-half sales fell 12 percent to their lowest since 2004 and net profit tumbled 25 percent as Europe’s five-year motor industry slump persists.

The maker of Vespa scooters said the strength of its brand as well as cutting back on investment and other costs allowed it to maintain its EBIT profit margin at 15 percent, matching 2012.

Demand in Asia was flat but it would push ahead with plans to boost sales there to 50 percent of the total to offset the European decline as outlined in its 2011-2014 business plan, it said. Piaggio has missed revenue targets for several years.

The company gave no guidance or any outlook for next year and said it will present a new set of targets later in 2013.

About half its revenue comes from Europe, where two-wheel vehicle sales fell 16 percent in the first half, it said. In Italy, where Piaggio has a 25 percent market share, two-wheel vehicle sales have fallen 53 percent over the last six years to 206,422 in 2012, according to trade group ANCMA.

Consolidated sales for the first half were 671.5 million euros ($888.8 million), net profit was 24.9 million, and EBITDA was 100.6 million, down from 114.4 million euros last year.

Shares in Piaggio fell 1.1 percent to 2 euros by 1351 GMT. ($1 = 0.7555 euros) (Reporting by Jennifer Clark; Editing by Louise Ireland)

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