Ferrari N.V.: Periodic Report on the Buyback Program

Rhea-AI Summary

Ferrari N.V. (NYSE/EXM: RACE) Announces Purchase of Common Shares Under Euro 350 Million Share Buyback Program

Insights

Financial Analyst

The recent share buyback announcement by Ferrari N.V. is a significant financial event that warrants an examination of its implications on shareholder value and market perception. Share buybacks are often perceived positively as they can indicate management's belief in the undervaluation of the company's stock, potentially leading to an increase in earnings per share (EPS) and return on equity (ROE) by reducing the number of shares outstanding.

However, the strategic timing and financing of buybacks are crucial. The buyback is part of a multi-year program, suggesting a long-term commitment to returning value to shareholders. The substantial investment of Euro 53.6 million for shares on the EXM and USD 30.3 million on the NYSE reflects a confident capital allocation strategy. Yet, it is imperative to analyze whether these funds could have been more effectively used for business expansion or debt reduction.

Investors should consider the impact of the buyback on the company's financial health, particularly its cash reserves and debt levels. It is also important to assess the buyback's alignment with the company's overall strategic goals and the potential signal it sends about future growth prospects.

Industry Analyst

Within the luxury automotive sector, Ferrari's share buyback program must be contextualized against industry trends and macroeconomic factors. The automotive industry is capital intensive with a significant focus on research and development (R&D), particularly as the market shifts towards electric vehicles (EVs) and sustainable practices.

Considering Ferrari's positioning as a premium brand, the buyback strategy may support maintaining exclusivity and driving demand. However, it is critical to evaluate if the capital used for share repurchases could have been allocated to innovation or enhancing the brand's competitive edge in a rapidly evolving industry landscape.

Analysis of Ferrari's financials compared to its peers would provide further insights into the company's performance and the potential impact of the buyback on its market position. Monitoring the stock's performance post-announcement can also offer indications of market sentiment towards the company's strategic decisions.

Economist

From an economic standpoint, the share buyback by Ferrari N.V. reflects broader economic conditions, including interest rates, investor confidence and corporate governance practices. In a low-interest-rate environment, companies may find it financially advantageous to return capital to shareholders through buybacks rather than investing in low-yield assets.

The announcement also comes at a time when global economic indicators suggest cautious optimism or potential headwinds, such as inflation or geopolitical tensions, which could affect consumer spending on luxury goods. The buyback decision must be evaluated in the context of these macroeconomic factors and their potential influence on Ferrari's operational performance and future growth.

Moreover, the execution of such a large-scale buyback program may have implications for liquidity in the stock market, affecting Ferrari's stock volatility and the broader market dynamics within the luxury automotive segment.

Maranello (Italy),  December 21, 2023 – Ferrari N.V. (NYSE/EXM: RACE) (“Ferrari” or the “Company”) informs that the Company has purchased, under the Euro 350 million share buyback program announced on November 7, 2023, as the fourth tranche of the multi-year share buyback program of approximately Euro 2 billion expected to be executed by 2026 in line with the disclosure made during the 2022 Capital Markets Day (the “Fourth Tranche”), the additional common shares - reported in aggregate form, on a daily basis - on the Euronext Milan (EXM) and on the New York Stock Exchange (NYSE) as follows:

	EXM			NYSE				Total
Trading	Number of common shares purchased	Average price per share	Consideration excluding fees	Number of common shares purchased	Average price per share	Consideration excluding fees	Consideration excluding fees	Number of common shares purchased	Average price per share	Consideration excluding fees
Date		excluding fees			excluding fees				excluding fees
(d/m/y)		(€)	(€)		($)	($)	(€)*		(€)*	(€)*
12/12/2023	4,738	344.1123	1,630,404.08	8,088	370.8562	2,999,484.95	2,776,272.63	12,826	343.5737	4,406,676.71
13/12/2023	4,756	340.2586	1,618,269.90	10,892	367.2091	3,999,641.52	3,707,834.91	15,648	340.3697	5,326,104.81
14/12/2023	6,012	332.9184	2,001,505.42	9,595	364.7160	3,499,450.02	3,204,918.05	15,607	333.5954	5,206,423.47
15/12/2023	5,803	331.7367	1,925,068.07	8,424	356.0562	2,999,417.43	2,740,194.98	14,227	327.9161	4,665,263.05
18/12/2023	6,855	318.1284	2,180,770.18	8,651	346.7501	2,999,735.12	2,747,513.39	15,506	317.8307	4,928,283.57
19/12/2023	6,963	315.5697	2,197,311.82	-	-	-	-	6,963	315.5697	2,197,311.82
20/12/2023	6,940	315.4956	2,189,539.46	-	-	-	-	6,940	315.4956	2,189,539.46
	42,067	326.6900	13,742,868.94	45,650	361.3960	16,497,729.03	15,176,733.96	87,717	329.6921	28,919,602.90
Total

(*) translated at the European Central Bank EUR/USD exchange reference rate as of the date of each purchase

Since the announcement of such Fourth Tranche till December 20, 2023, the total invested consideration has been:

• Euro 53,585,304.65 for No. 162,929 common shares purchased on the EXM
• USD 30,295,782.71 (Euro 27,798,654.09*) for No. 83,738 common shares purchased on the NYSE.

As of December 20, 2023, the Company held in treasury No. 13,505,409 common shares equal to 5.26% of the total issued share capital including the common shares and the special voting shares, net of shares assigned under the Company’s equity incentive plan.

Since the start of the multi-year share buyback program of approximately Euro 2 billion announced during the 2022 Capital Markets Day, on July 1, 2022, until December 20, 2023, the Company has purchased a total of 2,580,951 own common shares on EXM and NYSE, including transactions for Sell to Cover, for a total consideration of Euro 640,580,719.88.

A comprehensive overview of the transactions carried out under the buyback program, as well as the details of the above transactions, are available on Ferrari’s corporate website under the Buyback Programs section (https://www.ferrari.com/en-EN/corporate/buyback-programs).

Attachment

• FNV BB PR 21 December 2023 ENG

FAQ

How much did Ferrari N.V. (NYSE/EXM: RACE) invest in the share buyback program?

Ferrari N.V. invested Euro 53,585,304.65 for 162,929 common shares purchased on the EXM and USD 30,295,782.71 (Euro 27,798,654.09*) for 83,738 common shares purchased on the NYSE.

What is the total number of common shares purchased by Ferrari N.V. (NYSE/EXM: RACE) under the buyback program?

As of December 20, 2023, Ferrari N.V. has purchased a total of 2,580,951 own common shares on EXM and NYSE, including transactions for Sell to Cover.

How many common shares does Ferrari N.V. (NYSE/EXM: RACE) hold in treasury?

As of December 20, 2023, Ferrari N.V. held in treasury 13,505,409 common shares equal to 5.26% of the total issued share capital.

Where can I find details of the transactions carried out under Ferrari N.V.'s (NYSE/EXM: RACE) buyback program?

Comprehensive details of the buyback program transactions are available on Ferrari N.V.'s corporate website under the Buyback Programs section.