(The author is a Reuters Breakingviews columnist. The opinions expressed are their own.)
MILAN (Reuters Breakingviews) - Concise insights on global finance.
PIT STOP. Ferrari is smoothing the path for its next driver. The maker of $215,000 sports cars delayed its 2022 financial targets by a year, dragging shares down 6%. It now predicts it will take until 2023 for annual EBITDA to reach between 1.8 billion euros and 2 billion euros. This contrasts with estimates-beating first-quarter core earnings of 376 million euros and an order book at record levels.
Ferrari blamed the protracted Covid-19 emergency for the change in guidance. The group currently run by Agnelli family scion John Elkann after the surprise departure of Louis Camilleri last year will likely push investment earmarked for 2020 into this year and the next, boosting costs. And it’s not immune to a global chip shortage. To counter the impact, Ferrari could draw from its waiting list and sell more cars. But that would dent its scarcity value. By disappointing shareholders now, chairman and acting chief executive Elkann will at least make it easier for his successor to have a safer start. (By Lisa Jucca)
On Twitter twitter.com/breakingviews
Earlier in Capital Calls:
Lufthansa braces for debt mountain fly-by
Telenor’s tricky Myanmar call
Martin Sorrell can shrug off WPP pay spat
No use crying over spilt South Korean milk
A grim reading from Ant’s valuation tea leaves
Reuters Breakingviews is the world's leading source of agenda-setting financial insight. As the Reuters brand for financial commentary, we dissect the big business and economic stories as they break around the world every day. A global team of about 30 correspondents in New York, London, Hong Kong and other major cities provides expert analysis in real time.
Sign up for a free trial of our full service at https://www.breakingviews.com/trial and follow us on Twitter @Breakingviews and at www.breakingviews.com. All opinions expressed are those of the authors.