Ferretti Group

Earnings Release • Aug 2, 2023

FERRETTI SPA APPROVES GROUP'S 2023 HALF-YEAR RESULTS

With a margin of 14.7% and an Adjusted EBITDA of €83.4 million Ferretti Group presents very strong performance in H1 2023

The order backlog was at €1.4 billion, an increase of 15.8% when compared to H1 2022

• Revenue of €580.8 million, an increase of 8.6% when compared to H1 2022.
• Adjusted EBITDA of €83.4 million, representing an increase of 20.9% when compared to H1 2022 and with a margin of 14.7%, representing an increase of 120 basis points when compared to H1 2022.
• Net Profit of €40.9 million, an increase of 36.8% when compared to H1 2022.
• Order intake reached €573.8 million in H1 2023.
• Net financial position of €320 million of net cash in H1 2023.
• The Group confirms its mid term guidance

Forlì, August 2, 2023 - The Board of Directors (the "Board") of Ferretti SpA today reviewed and approved the Group's H1 2023 consolidated financial results.

Mr. Alberto Galassi, the Group's Chief Executive Officer, stated: "We continue to grow year on year and semester on semester, on the strength of a steadily increasing order book, indicative of a commercial success that never ceases to reward us. We are demonstrating great efficiency by continuing to improve our margins, while proceeding swiftly in the development of new models and new projects. During the season of the major Mediterranean boat shows, which is now just around the corner, we will present our new models, which further extend the product range, the driver of our growth strategy aimed at the ever-increasing satisfaction of our owners and shareholders".

The consolidated key financial highlights of the 2023 first half follow:

(in thousands Euro)	June 30, 2023 (unaudited)	June 30, 2022 (unaudited)
Net revenue	580,841	534,948
Revenue pre-owned	(13,419)	(24,328)
Net revenue without pre-owned	567,422	510,619
Operating costs	(484,005)	(441,582)
Adjusted EBITDA	83,418	69,037
Special items	(802)	(23,099)
Operating exchange gains/(losses) and Share of loss of a joint venture	836	(1,176)
EBITDA	83,451	44,762
Depreciations and amortization	(30,128)	(25,518)
Financial income, financial expenses, financial exchange gains/(losses)	2,189	9,906
Profit before tax (PBT)	55,512	29,151
Income tax	(14,658)	724
Profit after tax (PAT)	40,855	29,875
Adjusted EBITDA/Net revenue without pre-owned	14.7%	13.5%

Revenue overview, Order intake and Order backlog

Revenue

The Group's overall net revenue increased by approximately 8.6% from approximately €534.9 million for the six months ended June 30, 2022 to approximately €580.8 million for the period H1 2023 thanks to the strong order backlog built in 2022. The following table summarises the net revenue for each of the business lines by application during the periods indicated:

Six months ended 30 June
(Unaudited)		(Unaudited)
Net	% of Total	Net	% of Total
Revenue	Revenue Net	Revenue	Net Revenue
			43.7%
			37.6%
64,847	11.2%		9.1%
48,221	8.3%	51,024	9.5%
580,841	100%	534,948	100%
	259,790 207,983	2023 44.7% 35.8%	2022 233,710 201,286 48,928

Note: (1) Mainly comprising revenue from ancillary businesses and the FSD.

Revenue by segment

The table below shows the breakdown of net revenue by production type:

	June 30, 2023 (unaudited)	June 30, 2022 (unaudited)
Composite yachts	259,790	233,710
Made-to-measure yachts	207,983	201,286
Super yachts	64,847	48,928
Other businesses	48,221	51,024
Total net revenue	580,841	534,948

Revenue arising from other businesses is broken down below.

	June 30, 2023 (unaudited)	June 30, 2022 (unaudited)
Boat brokerage	5,363	6,691
Sales and provision of carpentry products and services	9,445	7,562
FSD	1,446	459
Used boats	13,419	24,328
Provision of services and sales of replacement parts,
merchandise and other goods	8,845	7,861
Wally sailboats	9,703	4,124
Total other businesses	48,221	51,024

Composite yachts reached €259.8 million, equal to approximately 44.7% of total revenue, in H1 2023 (from €233.7 million, equal to approximately 43.7% of total revenue, in H1 2022).

Made-to-measure yachts reached €208.0 million, equal to approximately 35.8% of total revenue, in H1 2023 (from €201.3 million, equal to approximately 37.6% of total revenue, in H1 2022).

Super yachts reached €64.8 million, equal to approximately 11.2% of total revenue, in H1 2023 (from €48.9 million, equal to approximately 9.1% of total revenue, in H1 2022).

Other businesses¹ reached €48.2 million, equal to approximately 8.3% of total revenue, in H1 2023 (from €51.0 million, equal to approximately 9.5% of total revenue, in H1 2022).

Revenue by Region

The breakdown of net revenue by geographical area was as follows:

	June 30, 2023 (unaudited)	June 30, 2022 (unaudited)
EMEA	250,247	225,641
APAC	73,857	38,063
AMAS	143,668	171,293
Global*	64,847	48,928
Other businesses	48,221	51,024
Total net revenue	580,841	534,948

* The item "Global" refers to net revenue from super-yachts not attributed to a single geographical area, inasmuch as, for example, the client's country of residence differs from that of registration of the vessel.

The AMAS region reached €143.7 million, equal to approximately 24.7% of total revenue, in H1 2023 (from €171.3 million, equal to approximately 32.0% of total revenue, in H1 2022).

The EMEA region reached €250.2 million, equal to approximately 43.1% of total revenue, in H1 2023 (from €225.6 million, equal to approximately 42.2% of total revenue, in H1 2022).

The APAC region reached €73.9 million, equal to approximately 12.7% of total revenue, in H1 2023 (from €38.1 million, equal to approximately 7.1% of total revenue, in H1 2022).

¹ Including ancillary activities, FSD, Wally sail and pre-owned

Other and Super yachts² reached €113.1 million, equal to approximately 19.5% of total revenue, in H1 2023 (from €100.0 million, equal to approximately 18.7% of total revenue, in H1 2022).

The Group's widespread global presence enables the Group to capture the growth in all regions, compensating the regional cycles at times.

Order intake

The order intake was €573.8 million at June 30, 2023.

Order backlog

The order backlog was €1,410.5 million at June 30, 2023, representing an increase of approximately 15.8% when compared to June 30, 2022 (€1,218.0 million) thanks to strong worldwide demand.

Consolidated operating and net results

ADJ. EBITDA

The Group's adjusted EBITDA (excluding listing expenses and related costs, Management Incentive Plan and other minor non-recurring events) for the Relevant Period amounted to approximately €83.4 million, increased by approximately 20.9% for the six months ended June 30, 2022 which amounted to approximately €69.0 million, demonstrating the increase in profitability of our operating performance.

This strong performance is due to three main factors:

• Commercial: a longer waiting list due to the high order backlog, reflecting higher pricing power.
• Strategic positioning: a larger presence in the most profitable segment, such as Madeto-measure
• Industrial: economy of scale in purchasing and more efficient absorption of fixed costs.

Net Profit

The Group's profit for the period increased by approximately 36.8% from approximately €29.9 million for the six months ended June 30, 2022 to approximately €40.9 million for the Relevant Period mainly due to the increase in volumes and the increase in margin.

² Including ancillary activities, FSD, Wally sail and pre-owned

This 7.2% margin represents an increase of 130 basis points when compared to the 5.9% for the 1H 2022.

Earnings per share

Earnings per share was € 0.12 as of June 30, 2023, compared to € 0.10 as of June 30, 2022.

Earnings per share were calculated as the ratio of net profit for the period attributable to shareholders of the Company to the weighted average number of shares in issue during the year and coincides with the earnings per share diluted due to the absence of partially dilutive instruments.

Consolidated Balance Sheet Items Overview

Consolidated Net Financial Position

The Net financial position was €320 million of net cash from €365 million of net cash as of 31 December 2022. The Group has demonstrated its capability to continue to generate cash despite the investments it has done and the ca €20 million dividend it has paid to shareholders.

Capex

The Capex for the period of H1 2023 was €84.5 million and it was dedicated to the innovation of the product portfolio and the expansion of the company's production capacity. Most of the capex is related to the acquisition of the Ravenna shipyard.

Significant events occurred during the first half of 2023

The Group held its first Capital Markets Day in Milan on March 21, 2023 providing the mid term outlook.

The Group reached an agreement with Rosetti Marino S.p.A. for the acquisition of Cantiere San Vitale, in Ravenna of over 70,000 square meters.

In April, the Group made a big step forward in respect of the project in the former Belleli Yard port area in Taranto of over 220,000 square meters, where an industrial facility will be developed for the construction of plugs and molds, as well as research center for advanced materials. All the public administrations involved approved the remediation and industrial development project.

On June 27, 2023, the Company successfully completed the first ever dual listing between Euronext Milan and the Hong Kong Stock Exchange.

Significant events occurred after June 30, 2023

On July 25, 2023, it has been communicated that the partial exercise of approximately 2.8% of the over-allotment option granted by the selling shareholder, FIH, in the context of the listing of the shares of the Company on the Euronext Milan. The purchase price of the Shares is €3 per Share (equivalent to the offer price established in connection with the offering) for an aggregate consideration of €732,873. Payment of the aggregate consideration has been settled on July 27, 2023.

There was no other event that had a significant impact on the Group's operation, financial and trading prospects since the end of the Reporting Period, and up to the date of these Unaudited Interim Condensed Consolidated Financial Statements which the Board is aware of.

Outlook

The global luxury yacht industry has continued to grow solidly throughout 2021 and 2022, fostered by the growth of the VHNWI and UHNWI clientele in terms of both number and wealth. In this context, and as proved by its ability to outperform the underlying luxury yacht market in the past, the Group believes it is ideally positioned to continue to capture market growth, capitalizing on its unique and effective business model, strong heritage of iconic brands, unparalleled focus on product excellence and innovation, tailored approach for cultivating an exclusive community of luxury customers and its distinctive sales model. To continue building on the expected trends of the global luxury yacht industry, enhancing its value proposition and strengthening its overall resilience, the Group's future plans are based on the following strategic pillars:

• The Group will enhance and expand its product offering and product mix ahead of evolving market trends and customer expectations, with the aim to consolidate its market leadership position in both composite and made-to-measure segments, focusing on the segments with the highest growth potential and marginality.
• The Group will expand its made-to-measure offering into larger alloy yachts, developing new alloy-hulled super yacht models under its iconic Riva, Wally, Pershing, and Custom Line brands.
• The Group will also broaden both its yacht brokerage, chartering and management services and its after- sales and refitting services, extend its brand extension and licensing activities and further expand into the security and patrolling market.
• Finally, the Group will keep investing in the internalization of high value-added activities to support its future growth and product portfolio expansion.

The Group's results are not subject to seasonality, except for the concentration of deliveries in the northern summer season (May-August) and, to a lesser extent, in the southern summer season (November-January), especially for composite yachts.

***

CONFERENCE CALL

The results as of June 30, 2023 shall be presented to the financial community through a conference call to be held on August 2, 2023 at 01:00 pm CEST, 07:00 pm HKT.

To attend the webcast meeting, you can register at this link: https://event.choruscall.com/mediaframe/webcast.html?webcastid=Db8raYfC

To ask questions via audio, you can use the following dial-in numbers:

Italy	+39 02 802 09 11
France	+33 170918704
Germany	+49 6917415712
UK	+44 1 212818004
USA	+1 718 7058796
USA
(TOLL	1 855 2656958
FREE)
China	https://hditalia.choruscall.com/?\$Y2FsbHR5cGU9MiZpbmZvPWNvbXBhbnk=

***

This document contains "forward-looking statements" relating to future events and operating and financial results of the Ferretti Group. These statements by nature contain an element of risk and uncertainty in that they depend on future events and developments. The actual results may diverge significantly from those announced.

***

The Executive Officer for Financial Reporting, Marco Zammarchi, declares in accordance with Article 154 bis, paragraph 2, of the Consolidated Finance Act, that the accounting information

contained in this press release corresponds to the underlying accounting documents, records and accounting entries.

***

The Audit Committee has reviewed with the management of the Company the unaudited interim condensed consolidated financial statements and the interim report of the Company for the Relevant Period and agreed with the accounting treatments adopted by the Company, and was of the opinion that the preparation of the financial statements of the Company for the Relevant Period complies with the applicable accounting standards and the requirements under the Listing Rules and adequate disclosures have been made.

The unaudited interim condensed consolidated financial statement, which was prepared in Italian and translated into English herein for the convenience of the financial community, was also reviewed by EY S.p.A., the Company's independent auditor, in accordance with the criteria for a review recommended by "recommended by applicable laws".

Ferretti S.p.A. hereby announces that, in accordance with the laws and regulations in force, the consolidated 1H Financial Report as of June 30, 2023, as approved by the Board of Directors on August 2, 2023, has been filed and made, available to the public, at the registered office of the Company, on its website (www.ferrettigroup.com), as well as on the authorized storage mechanism ().

***

Ferretti Group

Thanks to Italy's centuries-old yachting tradition, the Ferretti Group is a world leader in the design, construction and sale of luxury yachts and pleasure vessels, with a unique portfolio of prestigious and exclusive brands: Ferretti Yachts, Riva, Pershing, Itama, CRN, Custom Line and Wally. Led by Chief Executive Officer Alberto Galassi, the Ferretti Group owns and manages seven shipyards located across Italy, which combine the efficiency of industrial production with typical world-class Italian craftsmanship, reaching customers in more than 70 countries across the world thanks to a direct presence in Europe, the United States of America and Asia and its network of approximately 60 carefully selected dealers. The Ferretti Group motor yachts, utmost expression of Made in Italy elegance and creative genius, have always stood out for their exceptional quality, cutting-edge technology, record safety and optimum performance in the sea, as well as their exclusive design and timeless appeal. For more information: www.ferrettigroup.com

Ferretti Group

Head of Media Relations Giovanni Bogetto Email: Giovanni.bogetto@ferrettigroup.com T.+39 02 83994 000

Investor Relations

Email: Investorrelations@ferrettigroup.com

Barabino & Partners

Federico Vercellino f.vercellino@barabino.it Mob: +39 331.5745171 Giorgia Serra g.serra@barabino.it Mob: +39 348.6342366

The consolidated financial statements of the Ferretti Group follow.

CONSOLIDATED STATEMENTS OF EQUITY AND FINANCIAL POSITION

(in thousands Euro)	June 30, 2023 (unaudited)	December 31, 2022
CURRENT ASSETS
Cash and cash equivalents	309,660	317,759
Trade and other receivables	49,872	59,432
Contract assets	135,148	115,372
Inventories	262,765	198,120
Advances on inventories	40,518	39,156
Other current assets	45,669	86,732
Income tax recoverable	1,583	2,091
	845,215	818,663
NON-CURRENT ASSETS
Property, plant and equipment	362,209	303,394
Intangible assets	263,701	264,070
Other non-current assets	4,734	5,031
Deferred tax assets	9,021	16,397
	639,665	588,893
TOTAL ASSETS	1,484,881	1,407,556
CURRENT LIABILITIES
Minority Shareholder's loan	1,000	1,000
		14,500
Bank and other borrowings	11,234
Provisions	63,417	42,946
Trade and other payables	383,345	337,364
Contract liabilities	175,591	185,914
Income tax payable	7,045	1,683
	641,632	583,408
NON-CURRENT LIABILITIES
Bank and other borrowings	23,492	24,056
Provisions	14,093	13,049
Non-current employee benefits	7,348	7,646

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Trade and other payables	005	1,006
	45,838	45,757
TOTAL LIABILITIES	687,471	629,165
SHARE CAPITAL AND RESERVES
Share capital	338,483	338,483
Reserves	458,136	439,525
Equity attributable to shareholders of the Company	796,619	778,007
Non-controlling interests	791	384
TOTAL EQUITY	797,410	778,391
TOTAL LIABILITIES AND EQUITY	1,484,881	1,407,556

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CONSOLIDATED STATEMENT OF PROFIT AND LOSS

(in thousands Euro)	June 30, 2023 (unaudited)	June 30, 2022 (unaudited)
Revenue	613,346	555,641
Commissions and other costs related to revenue	(32,505)	(20,694)
NET REVENUE	580,841	534,948
Change in inventories of work-in-process,
semi-finished and finished goods	65,828	2,826
Cost capitalized	14,832	14,625
Other income	8,335	7,716
Raw materials and consumables used	(316,071)	(260,839)
Contractors costs	(102,808)	(77,272)
Costs for trade shows, events and advertising	(12,120)	(9,493)
Other service costs	(58,856)	(61,053)
Rentals and leases	(4,482)	(3,733)
Personnel costs	(65,088)	(69,301)
Other operating expenses	(2,953)	(5,626)
Provisions and impairment	(24,844)	(26,859)
Depreciation and amortization	(30,128)	(25,518)
Share of loss of a joint venture	–	(18)
Financial income	4,277	5
Financial expenses	(1,957)	(2,356)
Foreign exchange gains/(losses)	705	11,100
PROFIT BEFORE TAX	55,512	29,151
Income tax	(14,658)	724
PROFIT FOR THE PERIOD	40,855	29,875
Attributable to:
Shareholders of the Company	40,448	29,608
Non-controlling interests	407	266
EARNINGS PER SHARE ATTRIBUTABLE TO SHAREHOLDERS OF THE COMPANY
Basic and diluted (€)	0.12	0.10

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

(in thousands Euro)	June 30, 2023 (unaudited)	June 30, 2022 (unaudited)
PROFIT FOR THE PERIOD Other comprehensive income/(loss) not to be	40,855	29,875
Profit on defined benefits plan	104	725
Income tax effect	(25)	(174)
	79	551
Other comprehensive income to be reclassified to profit or loss in subsequent periods:
Gains/(losses) from the translation of foreign operations	(2,012)	3,175
OTHER COMPREHENSIVE INCOME FOR THE PERIOD	(1,933)	3,726
TOTAL COMPREHENSIVE INCOME FOR THE PERIOD	38,922	33,601
Attributable to:
Shareholders of the Company	38,515	33,334
Non-controlling interests	407	266

CONSOLIDATED STATEMENT OF CASH FLOW

(in thousands Euro)	June 30, 2023 (unaudited)	June 30, 2022 (unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES: Profit before tax		29,151
Depreciation and amortization	55,512 30,128	25,518
Loss/(gain) on disposal of property, plant and equipment	(62)	5
Provisions	21,301	16,735
Financial income	(4,277)	(5)
Financial expenses	1,957	2,294
Share of loss of joint venture	0	0
Impairment of trade receivables, net		500
Provision/(reversal of provision) against inventories, net	0	27
	6,244	(3,837)
Decrease/(increase) in inventories	(72,252)	52,552
Change in contract assets and contract liabilities	(33,184)
Decrease/(increase) in trade and other receivables	4,133	(11,842)
Increase/(decrease) in trade and other payables	45,036	35,026
Change in other operating liabilities and assets	7,540	(579)
Income tax paid	0	(1,328)
Cash flows from operating activities (A)	62,076	144,215
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property, plant and equipment and intangible assets	(83,609)	(36,710)
Proceeds from disposal of property, plant and equipment and
intangible assets	367	709
Acquisition of subsidiaries	0	0
Change in other financial investments	42,384	(42,987)
Interest received	4,228	5
Cash flows used in investing activities (B)	(36,629)	(78,983)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issue of shares	0	223,320
Dividends paid	(19,903)	(6,707)
New bank and other borrowings	200	0
Repayment of bank and other borrowings	(9,874)	(14,364)
Interest paid	(1,957)	(2,232)
Cash flows from/(used in) financing activities (C)	(31,533)	200,017

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOW

NET INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS
(D=A+B+C)	(6,087)	265,248
Cash and cash equivalents at beginning of year (E)	317,759	173,010
Effect of foreign exchange rate changes, net (F)	(2,012)	3.175
CASH AND CASH EQUIVALENTS AT END OF PERIOD (G=D+E+F)	309,660	441,434
Cash and cash equivalents as stated in the consolidated statement of financial position	309,660	441,434

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CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

(in thousands Euro)	Share capital	Share premium*	Legal reserve*	Translation reserve*	Other reserves*	Equity attributable to the shareholders of the company	Non- controlling interests	Total equity
At January 1, 2022 (audited)	250,735	281,293	7,110	4,329	(45,189)	498,278	(212)	498,066
Profit for the period Other comprehensive income for the period: Profit on defined benefits plan, net of tax					29,608	29,608	266	29,875
Exchange differences on translation of foreign operations				3,175	રેરો	રેરો 3,175		રેરો 3,175
Total comprehensive income for the period Issue of share capital Transfer to the legal reserve Dividends	87,748	143,748	1,177		30,160 (8,175) (1,177) (6,707)	33,334 223,321 (6,707)	266	33,601 223,321 (6,707)
At June 30, 2022 (unaudited)	338,483	425,041	8,287	7,504	(31,089)	748,226	55	748,280
						Equity attributable to the
(in thousands Euro)	Share capital (Note 37)	Share premium* (Note 38)	Legal reserve* (Note 38)	Translation reserve* (Note 38)	Other reserves* (Note 38)	shareholders of the company	Non- controlling interests (Note 39)	Total equity
At January 1, 2023 (audited)	338,483	425,041	8,287	7,970	(1,775)	778,007	384	778,391
Profit for the period Other comprehensive income for the period: Profit on defined benefits plan, net of tax	-				40,448	40,448	407	40,855
Exchange differences on translation of foreign operations				(2,012)	79	79 (2,012)		79 (2,012)
Total comprehensive income for the period				(2,012)	40,527	38,515	407	38,922
Transfer to the legal reserve Dividends			2,620		(2,620) (19,903)	0 (19,903)	0 0	0 (19,903)

* These reserve accounts comprise the consolidated reserves of €458,136 thousand (2022: €409,743 thousand) in the consolidated statements of financial position.

JE 3 FERRETTINGHTS PERSHING Fitama Riva CRAVA CRAN CRANCINE

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