Sanlorenzo S.p.A. (SL) Earnings Call Transcript & Summary

Good evening, ladies and gentlemen. Welcome to our full year 2025 preliminary results. On Sanlorenzo, we have on the line Massimo Perotti, Executive Chairman; Attilio Bruzzese, the Chief Financial Officer; Pier Francesco Acquaviva Chief Corporate Officer; and myself, Head of Investor Relations. I leave the floor for the presentation to start to our Chairman, Massimo Perotti.

Good evening to everybody. Thank you for being in contact with us. I'd like to start the floor with the first chart, which is not just starting with numbers, but trying to understand what happened in 2025. And we are very pleased to confirm to you the numbers that we are very proud of, consider '25 was not an easy year, probably coming from '24 with expectation from the European Union election in June '24 and the American new President for November '24. People were expecting '25 grow with a return to normality after the war in Palestine and the war in Ukraine. Unfortunately, as everybody knows, 2025 started with some, I would say, disruptive situation, mainly in the Western world, the tariff, et cetera, et cetera. I'm not going to summarize what happened, but all this situation was giving to the market a kind of uncertainty. And the uncertainty was reflected in the market. So we are pleased to confirm to you and to show you again the resiliency, power and strength of Sanlorenzo. You see on the left, we can confirm with the number of 2025, sixth consecutive quarter of order intake growth. We can confirm the successful new models introduced in the market from the Cannes show is written below SD132, SX120, SL110A, BGX83 recently introduced to the Dusseldorf Show in January '26. The New Swan 128, which is the largest ever built 40--meter Maxi and there's 151. Thanks to the very successful new model launch, we got quite a good Q4 for 2025, which is giving back an extremely extraordinary good plus 16% of order intake in respect of 2024 order intake. We confirm a remarkable 18.8% EBITDA margin, considering that 2025 has been the first year of consolidation of Swan. And at the end, plus EUR 34 million in net cash flow generation in Q4. We have quite improve and increase our strength in the market by appointing new brand representatives in Brazil and Mexico and have a new office -- we opened a new offer in Australia and the new dealer in Japan. Nautor Swan, as I said, the integration is done. We are working hard, and we have already the first year with a profit after year of losses, as you know. So I promised to you that we will -- with the group with the strength of the group and the push of Sanlorenzo. We could do quite a good result in Nautor Swan in spite of 2025, which has been really very dry in order -- new order for the sale boat business. Simpson at the end, last but not least, Simpson Marine has been fully integrated. You see in the number of the growth of the APAC region, the APAC market, we can confirm that both distribution service platform is integrated in the group and is leveraged our strength worldwide. I'm very pleased to confirm this number. I'm very pleased to show you the resiliency of our company and I will like to give back the floor to [ Ivan ] because the second slide, I think, is quite interesting for all of you.

Thank you, with pleasure. Our 2025 growth continues to consistently outperform the luxury sector. By setting 2019, top line to 100 emerges clearly that our business model resiliency allows to grow even amid the context of uncertainty has experienced both in 2020 during the COVID pandemic. And in the last year, the generally softer luxury market. The reason is linked to 3 fundamental factors. First of all, we have no exposure to aspirational clients with the customer base made strictly of ultra-high net worth individuals. Just as important, the drivers behind the purchase decision of our customers are fundamentally different. They're meeting their need for well-being and longevity, seeking unique experiences and making the most out of their scares free time. Finally, the competitive advantage of our business model based on a product for [ true ] connoisseur yachtsmen, volume scarcity, high price point, even at the entry level ensures a superior stability of the underlying demand over time. For the presentation of the preliminary financial figures.

Thank you, Ivan, and welcome to everyone. We'll continue the expansion of the Sanlorenzo Group into the full year 2025 result achieving a progressive integration of Nautor Swan and Simpson Marine. The solid performances of the full year 2025 are in line with the guidance for the top line and also more than expected for profitability, considering the Sanlorenzo absolute luxury positioning. And then, in particular, analyzing the indicators, net revenue will just grow 3.2% year-on-year at EUR 960.4 million driven by the performance of the Superyacht Nautor Swan division and good results of the Americas and APAC region. EBITDA reached the amount of EUR 180.6 million plus 2.4% year-on-year with 18.8% margin on net revenue in New Yachts. EBITDA EUR 139.9 million, increased 0.4% year-on-year at 14.6% net revenue in New Yachts with a limited dilution from consolidation of Nautor Swan first full year. And the group net profit grew up 4.2% year-on-year with a remarkable total amount of EUR 107.4 million with a double-digit growth of 11.2% of net revenue in New Yachts. Organic investment for EUR 48.2 million mainly related to the increase in production capacity and new model developments with reduction of [indiscernible] year-on-year on net revenue New Yachts to 5%. And then the net financial position at EUR 20.1 million net cash end of December 2025 after dividends paid for EUR 34.8 million, and EUR 1.2 million of extraordinary acquisition. Therefore, the guidance 2025 met at all levels in fact, is fully reached the top line target, showing a [indiscernible] growth of 3.2% year-on-year. And more important, the full year 2025 result in terms of profitability are just more than expected for margin with EBITDA at [ 18.2% ] compared to the target of 18.7% and EBIT at 14.6% compared with the target of 14.5%. And with an overperformance in the bottom line with the group net result at EUR 107 million plus 4.2% exceed the guidance, while CapEx at EUR 48.2 million are in target range. Now we can analyze a figure more in detail. starting from the top line. In this case, we had a good performance of the Superior division, plus 0.5% year-on-year, where the [indiscernible] Steel line excellent performance of Nautor Swan division, which accelerates plus 45.1% year-on-year with the support of the Maxi line and confirming the strong progression on the integration process we are doing. And then the result of the Yacht division that decreased 5.4% in full year 2025 year-on-year, but recovering plus 8.2% in Q4 year-on-year, also considering the larger units kicked into production in the last quarter 2025. Bluegame recorded EUR 85.5 million, minus 7.4% year-on-year successfully navigating the headwinds in this segment below 24 meters. And about the breakdown by geography, the group had a strong growth in Americas region, you can see 35.5% year-on-year after the expansion in the new market, Brazil and Mexico and APAC region turns positive, plus 5.1% year-on-year after the entrance in the Japan and West Australia market through the Simpson Marine strategic platform. European remain solid, plus 1.3% year-on-year, showing in Q4 a shift to a more balanced global mix. And the EMEA region characterized by lumpiness given the low unit and at the same time, high average ticket market decreased 28% in the full year 2025, but in the meantime, increased 100% in Q4 2024 year-on-year. Now the profitability expansion follows the planned trajectory. In fact, the EBITDA margin grew by 2.5% and reached a margin of 18.8%, net revenue new yards, stable year-on-year even after this 1 first full year consolidation. The rigorous focus on gross margin increased that benefit on price and mix effect allowed to Sanlorenzo [indiscernible] expand margins. The EBIT increased 0.4% year-on-year considering the higher incidence of net revenue in New Yachts for Nautor Swan due to the smaller scale production and legacy investment before acquisition. And finally, the group net profit grew up 4.2% at 11.2% on net revenue New Yachts with positive effect of tax benefit more than offsetting the higher financial expenses after cash out for 2024 acquisition. The gross backlog reached a level of almost EUR 2 billion and benefit of robust full year order intake of EUR 943 million, plus 16% year-on-year. Therefore, the positive market dynamic in Q4 is important considering the order intake of EUR 253 million with a double-digit growth of 10.1% year-on-year. Net backlog end of 2025 is more than EUR 1 billion and give to the group a long visibility on the future result, considering the composition of EUR 618 million for 2026 plus EUR 384 million for 2027 and beyond. Furthermore, backlog is consistent and high quality in consideration that it is sold 88% to final customers thanks to the unique Sanlorenzo business model. And with the sold deliveries up to 2027, 2028, and 2029, respectively, for Bluegame, Yacht, Superyacht division and also the Swan division, the sole delivery are up to 2028. So consistent are waiting list, especially for yachts above 30 meters. About the order intake trend after the normalization of the market, the group from Q3 2024 to Q4 2025 reached the sixth consecutive quarter of growth in order intake. So this is a proven trend a strong performance considering the positioning of the brand and confirming how Sanlorenzo is resilient to the cycle even in a time of uncertainty like this and how Sanlorenzo is absolute luxury and not exposed to aspirational customers. So the order intake is consistently growing. And in the last Q4 increased 10.1% year-on-year. The net backlog end of 2025 is more than EUR 1 billion. So we have around a full year of revenues still to book and already contracted. Continuing the organic investment program that reached the amount of EUR 48.2 million end of December 2025 at consistent perimeter -- constant perimeter. About 89% related to expansion, new production and distribution capacity, EUR 22.6 million. Acquisition and new acquisition consider that we had additional EUR 1.2 million in 2025, of which EUR 0.8 million referred to Arturo Foresti acquisition, a supplier for the production of electrical system and EUR 0.4 million refer to Mediterranean Yacht management acquisition in Monaco in-house brokerage company to support the distribution of Nautor Swan. The incidence of organic CapEx on net revenue New Yachts decreased to 5%. Now the evolution of the net financial position end of December 2025 highlights a net cash of EUR 20.1 million after a dividend payment of EUR 34.8 million, organic CapEx of EUR 48.2 million and extraordinary acquisition of EUR 1.2 million. The net cash generation in Q4 2025 was EUR 34.1 million and benefited by the net working capital decrease after the peak reached during the 2025 well supported by order intake in particularly in the region Americas and APAC, where the group has a direct distribution. The total impact of IFRS 16 debt was EUR 28 million in December 2025 versus EUR 25.5 million of December 2024. Well, we have analyzed the financial result, and I leave the floor to Ivan to continue with the business update.

Thank you, Attilio. So very quickly on the most important concepts. Here, we come from 2025 where we have launched represented some very important models, which have collected very exceptional feedback from the market, both in terms of contracts signed, order intake and commercial pipeline, particularly not worthy are the 3 models of the Yacht division, which are all above 30 meters. The SL110A, which features the symmetric design, the SX120, which is the current flagship of the cross-over a range of very iconic invented by Sanlorenzo and the SD132, which is the largest composite model delivered today above 40 meters length where we enjoy virtually no competition. Also for 2026, we have in the pocket a very exciting pipeline of new models. We just started in Dusseldorf with the presentation of the BGX83, which is the flagship of Bluegame to continue then with 4 new models for Sanlorenzo across both Yacht and Superyacht division, with, again, a focus on the large composite segment. In the case of Nautor Swan, we are not just talking about new models but we are talking about completely new product lines, which bring additional market segments to the business additive to the current revenues. In 1 case, we have this one alloy, which will be revealed the first model so the large segment units made of metal effectively Superyacht of the Sailing segment and later on, an unveil of the Bluewater line, SWANSCAPE, dedicated to those customers that prefer comfort over mere performance for long extended cruising. Speaking of new lines, we remind that Sanlorenzo also presented back in October, the Sanlorenzo Heritage, which draws effectively into our deepest DNA back to 1958 and projects it into the future. Going to the next slide. We see the other core part central to our development strategy. So the geographic expansion the new American quarter in Fort Lauderdale at Pier Sixty-Six was just opened. And along we did, which will be central for further penetration into the American market, where we have a massive opportunity. We just come from signing 2 important partnerships with new brand representatives in Mexico and in Brazil, which are very strategic markets, which so far, we have covered from abroad. And from now on, we will cover with a local commercial presence. In terms of completely new geographies, we have entered recently Japan with a stronger brand representative and Australia with our direct network of Simpson Marine, which can be leveraged across the region. We now open the Q&A session. So we invite you to either use the Zoom tool to raise your hand or to leave your question in the chat. We will try to address as many questions as possible.

I see a question in the chat from Jackson. Could we get commentary on 2026 outlook, given no guidance was given?

Yes, [ Jackson ], pleased to reply to you. Consider that we had the Dusseldorf show on the 20th of January. And today, in the meantime, we are talking to you. There is the Miami show going on. The starting of January, middle of February business is showing a better order intake of both January '25 and January '24. So we have a feeling that the starting of the New Year, 2026 is good, and we do expect an improvement in volume of all 4, I would say, business Yacht, Superyacht, Bluegame and Swan. So it is a confirmation that the market is more active since the first months of the year, which normally is not easy. In January, February, people are still thinking to go skiing more than going boating.

I see a raised hand from Niccolo Storer.

The first one is about Q4 intake. If I put together 2 things. One, that your, let's say, comments about the American season back at Q3 results presentation were quite downbeat. And I also see that let's say, the share of backlog to final clients has declined by 2 percentage points from Q3 to Q4 is kind of suggesting me that you had to sell to dealers to get to the plus 10% order intake in Q4. So if you can comment a bit on that. And so on the quality of the Q4 order collection? Second question, already answered about Dusseldorf and Miami. And so my other question is about intake by brand, in particular, Sanlorenzo perimeter versus Swan, you suggested that an intake in 2025 was quite weakish. Can you maybe spend a few numbers, quantifying how good was Sanlorenzo [indiscernible] and Swan.

Look, I do reply the first question. I didn't understand the second. So if somebody on the floor in La Spezia can reply is good. For the first question, Storer, we are really now picking to small things. I mean, we are close to EUR 1 billion. Therefore, 2% of EUR 1 billion is EUR 20 million is almost nothing. So by counting the difference between 90% of direct sales. So 88% is really something difficult to evaluate. The reason of the EUR 20 million stock boat to dealer is because we appointed 2 important new dealer in the last quarter of '25, which is a guy in Mexico and a new guy in Brazil. These 2 new brand representative. They are external is outside dealer working directly with Sanlorenzo America, which is our company representing Sanlorenzo in the Americas. And those 2 dealers, they just bought EUR 10 million each of stock boat because when you are appointed exclusive dealers, you have to -- you must buy stock boat in order to be appointed exclusive dealers. So this is the only reason. What is really important that we have 16% higher order intake in 2025 in respect of 2024. And this is much more important then that very little reduction from 90% to 88%. Consider that 90% or 88% direct contract is why above any other company worldwide. So this is the main characteristic of our business model, the quality of the backlog nobody else has. The second question, I didn't understand. So maybe Ivan or Attilio can reply.

Yes. About Niccolo, the order intake, especially for 1 versus the rest of the group. You can consider that we collected around EUR 90 million in the full year 2025. And this is especially for this one line compared with 2024, where we collected especially new orders for the Maxi alloy. This is the total amount for 2025.

A question in the chat from [indiscernible]. Can you please share some update on the chartering service for clients to use the unit for some time agreed. So an update on charter?

Yes. Charter has been plan. I mean we do not have an increase in the charter business and no decrease was in line with '24, which is showing that '25 has been not an easy year in the market due to the uncertainty, the geopolitical uncertainty I was talking before. Charter for us is within the high-end service with refit and other characteristic, which is something that will be deployed and developed during the description of the new 3 years plan that will be done in May in the meeting of the 8th of May here in Venice. The logic of developing the charter business between Hong Kong for Lauderdale, Monaco and Equinox headquarters, which is in Torino, Milano. You know that we like the idea to have a win-win situation from the side of adding some profit to our business, but mainly to connect with new customers. They are willing to charter the Sanlorenzo fleet in Charter. And when they use our boat year-after-year, they get acquainted. They appreciate the quality of Sanlorenzo. And at the end, they buy a new boat. So the win-win situation is coming some service, some profit, some business, but mainly to show and to expand the contact of our boats to new customer base to expand the customer -- potential customer to buy new boats in the future consider that Swan has a fantastic company called [ MIM ] in Monaco. They work since 20 years, 15 years in developing the Swan charter fleet around the world. And that experience has been also very positive to acquire new customer from Swan as well as we are trying to do with Sanlorenzo business.

We see a raised hand from Natasha Brilliant from UBS.

A few questions. Firstly, just on pricing dynamics. If you can just help us think about pricing as we look forward into 2026. Sorry if I missed it, but just if you can help us on CapEx and working capital for this year, what we should think about that? And then just coming back to your -- or the comments about the new brand ambassadors in South America, and you've talked about new presence in Asia anything more you can share about the pipeline for this year in terms of that sort of geographic expansion piece would be very helpful.

Thank you, Natasha. I start from the end. We think that both Asia, APAC market and South America will be a growing market for 2026 for both Yacht and Superyacht division. Regarding pricing, it is too early to confirm aggressivity in the pricing. We would like to see what will be the result of Q1 '26. In case Q1 '26 will be good as from the first month generally, then for the Q2 and Q3, we will try to increase a bit our price in order to take the best advantage for the Cannes, Monaco, Genova September shows 2026. But today, I cannot confirm to you because I think our way of management is always very conservative, very -- how I can say in English now, I missed the word, very conservative. I mean, we do declare numbers and things when we have a real confirmation from the market. So we prefer not to anticipate something that we are not sure of. The first quarter of '26, I think, will give us good sign in order to maybe increase the profitability versus prices. For the CapEx and working capital, I will leave the word and the floor to Attilio.

Yes. Yes, Massimo. For the CapEx consider that the level will reach this year around EUR 50 million could be considered as a number also for 2026. But in any case, we will be more precise in the next meeting, we will have -- about the net working capital, consider that we believe that we reached the peak during the 2025. And if we can exclude the seasonality, we can consider a progressive absorption of the net working capital, especially starting from H2 2026 and consequence semester for the beginning of 2026. In any case, we consider good level of net working capital close in the range between 3% and 8% for the future because this could be a good lever to manage the business after that we have the introduction of the direct distribution, especially for Simpson Marine in the APAC region, Sanlorenzo Med and the expansion in U.S.

We have one more question from [indiscernible]. With deliveries being sold up to 2029, any plans to extend the manufacturing output for years to come?

Yes, we have a plan in our La Spezia shipyard. We have the right from the local authority to refill the existing water side, water cost for 10,000 square meter to produce extra 10,000 square meter in the harbor of La Spezia where we are going to produce -- to build a new plant of 6,000 square meter. The new plant will be splitted between the Superyacht production and the big Maxi alloy Swan. You know that we have a new division coming starting from a 44-meter already sold and in production. We are starting to produce and design a new 50 meter. And the range of the aluminum Maxi Swan will go up to 60 meter. The smaller 44-meter will be built with a 50-meter will be built in Viareggio. We will bring back to Viareggio the Maxi business. And the boat above 50-meter, let's say, 58-meter and bigger will be built in La Spezia. Because in Viareggio, there is not enough [ deep ] in the water to produce larger boat -- boat larger than 50-meter in the Maxi line. So the expansion will be done in Viareggio before the 2029.

I believe we have no more questions. So I leave it to the Chairman for final remarks.

Thank you for participating to the conference. We apologize we get late this Friday evening. But I have to say that in my heart, in my mind, the result of 2025 just explained and presented by Attilio, is confirming the fundamentals of Sanlorenzo. We think that is a message to you to the investor. We think that the today value of our competitors Ferretti Group, [indiscernible] for the acquisition of MarineMax in America is showing that the investor, the shareholders inside of those 2 companies are believing in the business. They trust the business is growing. And I think that at the end, the result of 2025 from Sanlorenzo is a very positive sign as well. So probably, we have been suffering some re-rating of our share in the market in 2024 and 2025. And we hope that you agree with me -- you agree with us that the confirmation of the guidance of 2025, the increase of 60% of the order intake in a geopolitical environment, which is not positive in 2025, started already in 2024 is the confirmation that this business is positive and has quite a good future. I thank you for your attention. See you soon. Bye-bye.

Thank you.