Energica announces the start of an important investment plan for 2021 aiming at developing a cost saving plan expected already from the early months of the new year.
The goal is to reduce production costs by 2% compared to the current bill of materials starting from the first semester of 2021, while getting to a 19% saving before the end of the second semester.
The Company therefore aims at improving the average production cost by 8% in 2021 and beyond 20% in 2022. As a reference – based on the production volume in 2019 in which the purchases of materials amounted at €3.0MM – the saving would amount to €234 thousands for the current financial year and to €587 thousandths for the future ones.
The plan provides for total investments amounting to around €2.2MM, €1.9 of which destined to the R&D sector. The total investment, which on June 30 2020 had surpassed €12MM – €4.0 of which before the IPO that happened in 2016 – and the significant growth of the turnover (expected at around €6.0MM for the fiscal year 2020 as per press release from the previous month) which will allow the company to optimise its production while maintaining a continuing technological leadership and performance of the models for sale.
As part of the new investments, which are close to €470 thousands, focused on power electronics and engine case building, will have their effects already in 2021.
“The investment and agreements started in the last months as per the already-announced plan” – says Andrea Vezzani, CFO Energica Motor Company S.p.A. – will allow to obtain a significant cost reduction in a few months’ time, which will have a direct impact on the gross margin, the most-relevant value for a growing company coming out of its initial stage.”
“The volume increase will then complete the evolution of the company income statement, allowing further saving from economies of scale, which haven’t been included in the current percentages yet.”