Ferrari(RACE) - 2022 Q4 - Annual Report

Sales and Shipments - Annual shipments increased from 9,119 in 2020 to 13,221 in 2022, reflecting a growth of 45.5% over the two-year period[416] - The average annual shipments over the three-year period from 2020 to 2022 were 11,165 cars[416] - The Americas accounted for 26.1% of total shipments in 2022, with 3,447 cars delivered[416] - Total shipments increased by 2,066 cars, or 18.5%, from 11,155 cars in 2021 to 13,221 cars in 2022[465] Financial Performance - In 2022, net revenues increased to €5,095 million, a 19.3% rise from €4,271 million in 2021[455] - Cost of sales rose to €2,649 million, representing 52.0% of net revenues in 2022, compared to 48.7% in both 2021 and 2020[457] - EBIT for 2022 was €1,227 million, accounting for 24.1% of net revenues, down from 25.2% in 2021[457] - Net profit for 2022 was €939 million, or 18.4% of net revenues, compared to 19.5% in 2021[457] - The ongoing conflict between Russia and Ukraine has led to increased costs for raw materials and energy, impacting EBIT margins[434] - Interest rates increased by approximately 60 basis points in 2022, negatively affecting financial services margins[435] Research and Development - Total research and development expenditure for 2022 was $934 million, with capitalized development costs amounting to$416 million[426] - Research and development costs expensed decreased to $518 million in 2022 from$574 million in 2021, indicating a shift towards capitalizing more development costs[426] - Research and development costs increased to €776 million, making up 15.2% of net revenues in 2022, compared to 18.0% in 2021[457] - The increase in research and development costs was primarily due to a €64 million rise in amortization of capitalized development costs[489] - The company is undergoing a period of structurally higher capital spending to broaden car architectures and transition to hybrid and electric powertrains[516] Capital Expenditures and Investments - Total capital expenditures for 2022 were €824 million, compared to €750 million in 2021 and €734 million in 2020[535] - Significant investments in intangible assets for 2022 included €416 million for development costs, with €301 million allocated for future model development[539] - Investments in the new e-building for BEV production amounted to €8 million in 2022, reflecting the company's expansion plans[544] - Contractual commitments for property, plant, and equipment purchases amounted to €201 million at the end of 2022, up from €74 million at the end of 2021[545] Shareholder Information - Exor is the largest shareholder with a 24.44% stake, translating to approximately 44,435,280 common shares[592] - As of February 13, 2023, approximately 40.5% of Ferrari's outstanding common shares were held in the United States, totaling around 78.5 million shares[598] - The company has entered into a Shareholders' Agreement with Exor and Piero Ferrari, which was amended on December 16, 2022, to include Trust Piero Ferrari[599] - The Shareholders' Agreement was automatically renewed for another five-year term until January 3, 2026, as neither party terminated it within the required timeframe[606] Corporate Governance - The Company adheres to the updated Dutch Corporate Governance Code, which will be applicable for the financial year beginning on or after January 1, 2023[611] - The current Board of Directors was appointed on April 13, 2022, and includes Mr. Benedetto Vigna as Chief Executive Officer since September 12, 2021[613] - The Company qualifies as a foreign private issuer under NYSE listing standards, allowing it to follow home country practices for corporate governance[610] - The updated Dutch Corporate Governance Code was published on December 20, 2022, and compliance will be reported in the management report for the financial year 2023[611] Cash Flow and Debt - Cash flows from operating activities for 2022 were €1,403 million, an increase from €1,283 million in 2021[519] - Free Cash Flow for the year ended December 31, 2022 was €597 million, an increase from €546 million in 2021[572] - Net Debt at December 31, 2022 was €1,423 million, an increase from €1,286 million in 2021[559] - The Group's net cash used in financing activities was €554 million in 2022, slightly down from €580 million in 2021[533] - Cash and cash equivalents at the end of 2022 were €1,389 million, up from €1,344 million at the end of 2021[519]