Racing Force Group: Board of Directors approved FY 2024 results with significant growth in all KPIs
EBITDA increasing and strong cash generation from operations
Record sales order intake at the beginning of 2025
Proposed Dividend of €0.09 per Share
THE BOARD OF DIRECTORS OF RACING FORCE S.P.A. APPROVED DRAFT FINANCIAL STATEMENTS AS OF DECEMBER 31, 2024 AND CONSOLIDATED FINANCIAL STATEMENTS 2024
- Revenues: €65.7 million (+4.8% vs FY 2023)
- Gross Profit: €40.0 million (61.0% Gross margin) vs €38.7 million in FY 2023
- Adjusted EBITDA: €10.5 million (16.0% EBITDA margin) vs €9.6 million in FY 2023
- Adjusted Net Income: €5.9 million (9.0% on Revenues) vs €4.8 million in FY 2023
- Operating cash flow: €7.6 million (72% cash conversion) vs €1.0 million in FY2023
- Net Financial Position: €0.1 million vs €3.2 million as of December 31, 2023
Ronco Scrivia (GE, Italy), March 26, 2025 - The Board of Directors of Racing Force S.p.A. ("Company" or "RFG"), the parent company of Racing Force Group, which is specialized in the development, production and marketing of safety components for motorsports competitions worldwide, as well as listed on the Euronext Growth Milan (RFG) and Paris markets (ALRFG), reviewed and approved the draft financial statements as of December 31, 2024 and the consolidated financial statements for 2024, prepared in accordance with international accounting standards.
Paolo Delprato, Chairman and CEO of Racing Force Group, commented: "The 2024 financial statements once again highlight a solid performance, driven by the growth of the Group's core business and profitability, combined with strong cash generation from operational management. These results were achieved in a macroeconomic environment marked by uncertainties and significant geopolitical tensions, during a period in which the Group focused resources on substantial investments, which are expected to be completed by autumn 2025 as planned.
The record volume of orders registered in the first quarter at a global level confirms confidence in our growth prospects in the motorsport business for the current season, which will be influenced by the introduction of new helmet regulations as well as by recently announced commercial agreements.
Beyond motorsport, 2025 began with the presentation of defense helmet prototypes at two of the leading industry's international trade fairs, generating strong interest among professionals from various countries, further validating our expectations. We are now in the final stages of developing these helmets, with completion expected by autumn, which will provide a significant boost to the Group's growth and open new opportunities.
Looking ahead, we are confident that the completion of strategic investments, continuous innovation, and the dedication of Racing Force's people-whom I sincerely thank for their passion and commitment-will enable us to face market challenges with determination, achieving increasingly ambitious results both in motorsport and across our various diversification projects".
Summary of Group Results as of December 31, 2024
- Group's Revenues reached €65.7 million, marking a +4.8% increase compared to the previous year. Excluding two non-recurring orders for non-technical apparel under the Racing Spirit brand, which were recorded in the first half of 2023, sales for the 2024 financial year grew by 6.1% year-over-year.
This growth was evident across all key geographical areas, further strengthening the Group's leadership position in the European market (+4.6%), which accounts for 65% of total revenues, as well as in Asia and the Pacific (+9.1%). In the Americas, the Group also increased its market share, with significant growth beginning in the second quarter and accelerating further in the third and fourth quarters of 2024 (+3.2% over the full year).
- Dealers remain the Group's primary sales channel, accounting for 60% of revenues, while Driver's Equipment is the leading product category (73.5% of revenues), driven particularly by strong sales of racing suits and helmets.
- Adjusted EBITDA[1] amounted to €10.5 million (EBITDA margin 16.0%), against €9.6 million in 2024 (EBITDA margin 15.4%). The variance is mainly due to higher gross profit following the increase in sales, net of costs related to the organizational structure and selling and distribution expenses.
- Adjusted EBIT1 was €6.9 million (10.5% EBIT margin), against €6.3 million (10.0% EBIT margin) in fiscal year 2023.
- Adjusted Net income1 was €5.9 million (9.0% of Revenues), representing a 22.8% increase compared to €4.8 million (7.7% of revenues) in 2023, driven by the increase in EBIT and the positive balance of financial management.
- Cash flow from operations amounted to €7.6 million, with a cash conversion rate of 72%, compared to €1.0 million in 2023 (cash conversion rate of 10.2%). This improvement was driven by EBITDA growth and a lower absorption of net working capital.
- The Group's Net Financial Position passed from €3.2 million at the end of 2023 to a balance of €0.1 million as of December 31, 2024, thanks to cash generated from operations, net of the investments of the period for €9.1million, and due to the share capital increase completed in June 2024 for an amount, net of fees and expenses, equal to €7.3 million.
Performance Analysis
In 2024, the Group recorded revenue increase of 4.8% (6.1% in the core business), further consolidating its growth path in the motorsport business. Since its listing on Euronext Growth Milan in 2021, the Group has maintained a steady sales growth, with a compound annual growth rate (CAGR) of 12% over the 2021-2024 period. These results were made possible by the synergies from integrating different brands and the Group's continuous investment in research, development, and product innovation.
Throughout the year, the Group undertook significant investments to strengthen its operational infrastructure in support of future growth. Key initiatives included expanding the Bahrain production facility with the construction of a second floor and advancing the expansion of the Ronco Scrivia headquarters, which is expected to be completed by summer 2025. In parallel, the workforce increased by 20 employees compared to December 31, 2023, in line with the investment plan initiated in previous periods.
The contribution margin reached €40 million, increasing by €1,316 thousand compared to 2023, with a 61% share of revenues. The slight decrease in marginality compared to the previous year (61.7%) is attributable to a different revenue mix and new commercial agreements, carrying a lower contribution, while significantly enhanced the visibility of the Group's main brands. Additionally, inventory write-downs totaling €151 thousand were recorded in 2024, of which €98 thousand were non-recurring.
The adjusted EBITDA stood at €10.5 million, up from €9.6 million in 2023, with a weight on revenue of 16% (15.4% in 2023).
These results were achieved in a challenging macroeconomic environment marked by geopolitical uncertainty, during a transitional year of significant investments aimed at driving stronger growth in the coming periods, supported by ongoing diversification projects.
The Group maintained rigorous control over operating and commercial costs, implementing reorganization initiatives to enhance efficiency and cost optimization.
In 2024, selling and distribution expenses rose to €10.5 million, compared to €10 million in 2023, mainly due to new technical partnership agreements. General and administrative expenses increased from €19.6 million in 2023 to €20.4 million in 2024, net of stock grant plan provisions, primarily due to higher personnel costs following the mandatory renewal of the national collective labor agreement in Italy and the addition of new managerial and technical personnel in the main operating locations.
The adjusted net result reached €5.9 million, up 22.8% from €4.8 million in 2023, with a weight on revenue of 9% (7.7% in 2023).
The operating cash flow saw a strong increase, reaching €7.6 million, compared to €984 thousand in 2023. Cash flows generated from operating activities, totaling €10.7 million, were partially absorbed by a €3.1 million increase in net working capital, mainly due to higher inventory levels for the production of Bell-branded helmets compliant with newly introduced homologation standards. As a result, cash conversion reached 72%, a significant improvement from 10% in 2023.
Operating cash flow contributed to financing €9.1 million in investments and the payment of €2.3 million in dividends.
The Group's net financial position improved significantly, moving from €3.2 million at the end of 2023 to €63 thousand as of December 31, 2024, thanks to operating cash flows and the share capital increase in June 2024, which amounted to €7.3 million, net of related costs and tax effects.
Finally, the Group's equity increased to €60.6 million, up from €48.5 million in 2023, thanks to the share capital increase and net results generated during the year, after dividend distribution.
The current capital structure is such as to allow investments in the coming future to further support the Group's growth plan, both within motorsport and as regards the diversification projects.
Current trading
Sales at the beginning of 2025 are in line with the previous year, maintaining stability across the Group's main geographic areas of operation. However, customer orders received in the first months of the year have shown strong growth compared to the same period of the previous year.
In the early months of the current fiscal year, the Group has ramped up production-partially initiated in 2024-of helmet models compliant with the new FIA 8859-2024 standard, anticipating a significant impact on sales starting from the second quarter of 2025.
Additionally, starting in autumn 2025, the new Snell homologation standard for helmets intended for the American market will come into effect, with an expected increase in sales in the U.S. beginning in the fourth quarter of 2025 and continuing significantly throughout 2026.
Regarding other key product categories, both for Car Parts and Driver's Equipment, the Group expects positive effects from technical partnership agreements in place for the season, particularly from the new agreement signed at the beginning of the year with the adidas brand for equipping Mercedes-AMG Formula 1 team drivers.
As for diversification projects in the defense industry, the first significant order of helmet shells for U.S. Air Force pilots is scheduled for delivery to Lift Airborne Technologies LLC in the first half of 2025. The riot police helmet (Riot) has successfully passed all major homologation tests, and the integrated system with a gas mask is currently undergoing certification, expected to be completed during the year. Regarding the helmet for special forces (Gladiator), the development of the first size has been completed, and testing for additional sizes is ongoing, with the goal of obtaining certification for the full range by autumn 2025.
In parallel, commercialization activities for all defense projects began in early 2025, with the first prototypes being showcased to the public for the first time at two major industry trade fairs - SHOT Show in Las Vegas (January) and Enforce Tac in Nuremberg (February) - generating strong interest among attendees, within the current scenario, characterized by significant expected investments in the defense industry at an international level, with potential positive impacts for the Group.
Within the Group's diversification initiatives, the Racing Spirit brand continues to expand successfully, recording significant growth of 32.7% compared to the 2023 fiscal year, excluding two non-recurring orders, alongside a substantial increase in its customer base. Simultaneously, the development of Zeronoise communication technologies is progressing, with a new agreement for the adoption of Driver's Eye technology by the IndyCar championship, as well as advancements in the fully athlete-integrated version of this technology, as seen in the Skier's Eye project, also as a result of the agreement with Oakley, aimed at creating new business opportunities in both the motorsport and defense industry.
The Group's priority for the coming periods, alongside revenue growth, remains improving structural efficiency to enhance profitability and, consequently, cash generation from operating activities.
The ongoing war between Russia and Ukraine, tensions in the Middle East, and the threat of tariffs from the new U.S. administration contribute to sustained geopolitical risk worldwide, creating significant uncertainty for the global economy and businesses. To date, the Group has experienced only marginal impacts on its operational results, but it will continue to closely monitor the situation throughout the year.
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Allocation of net result and dividend distribution
The Board of Directors of Racing Force S.p.A. has proposed to the Shareholders' Meeting to allocate the net profit for the fiscal year 2024, amounting to Euro 2,457,244, as follows:
- Euro 32,803 to the legal reserve;
- Euro 2,424,441 to the retained earnings reserve.
Additionally, the Board has proposed to distribute dividends up to a maximum amount of Euro 2,465,040, equivalent to Euro 0.09 per each ordinary share in circulation at the ex-dividend date, excluding the treasury shares held by the Company at such date, gross of legal withholdings, sourced from the retained earnings reserve, with up to Euro 2,424,441 coming from the newly allocated profit for the fiscal year 2024, and up to Euro 40,599 from retained earnings of previous years.
In accordance with the Euronext Growth Milan calendar, the ex-dividend date is set for May 12, 2025, the record date is May 13, 2025 and the payment date is May 14, 2025.
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Execution of the Stock Grant Plan 2023-2025
With regard to the second tranche ("Second Tranche") of the incentive plan "Stock Grant Plan 2023-2025" (the "Plan"), the Board of Directors noted that the objective outlined in the Plan concerning the minimum increase in consolidated adjusted EBITDA compared to the previous fiscal year has been achieved, therefore 97,637 rights have vested, entitling them to receive 97,637 RFG ordinary shares free of charge.
Pursuant to the Plan, the allocation of shares to the beneficiaries is subject, in addition to the vesting of the rights, to the continuation of the management or employment relationship throughout the entire vesting period and until the expiration of the vesting term (i.e., December 31, 2025). Therefore, the vesting term for all rights shall be unified at the end of the last financial year covered by the Plan.
Concerning the third tranche of the Plan (the "Third Tranche"), the Board of Directors (i) has nominatively identified the beneficiaries of the Plan ("Beneficiaries") and (ii) determined the maximum number of rights to receive ordinary shares of RFG for each of them, according to the terms and conditions of the Regulations ("Rights"), as well as (iii) established the performance targets upon which the allocation of shares to each Beneficiary will be conditional, pursuant to the same Regulations (the "Objectives").
In particular, the Board of Directors has set the quantity of Rights to be allocated to the Beneficiaries for the Third Tranche at a maximum of 212,201, corresponding to an equal number of shares of the Company. For further details regarding the Plan, please refer to the Information Document already made available to the public on the Company's website at www.racingforce.com, in the Investor Relations/Shareholders' Meetings section.
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Further resolutions of the Board of Directors
The Board of Directors - in compliance with the provisions of Article 6-bis of the Euronext Growth Milan Issuers' Regulations, as well as the Bylaws - has verified that the independence requirements set forth in the Bylaws and in Article 148, paragraph 3, of the TUF, as referred to in article 147-ter, paragraph 4 of the TUF, with regard to the director Marco Caneva, and that he is not in any of the circumstances that compromise, or appear to compromise, independence identified by the " Policy on quantitative and qualitative criteria for assessing independence requirements pursuant to Article 6-bis of the Euronext Growth Milan Issuers' Regulations" approved by the same board on April 29, 2024.
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Calling of the Ordinary Shareholders' Meeting
The Board of Directors resolved to convene the Company's Ordinary Shareholders' Meeting on April 29th, 2025, in a single session, at the time and location that will be communicated in the respective notice of convocation to be published in accordance with the procedures and deadlines prescribed by applicable regulations and bylaws. The Notice of Convocation of the Meeting, which will be published within the legal and statutory deadlines, will also specify the procedures for joining the Shareholders' meeting.
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Fil ing of Documentation
The notice of call and the related documentation prescribed by applicable regulations, including the draft financial statements as of December 31, 2024, the management report, the directors' reports on the items on the agenda of the Shareholders' Meeting, the report of the Board of Statutory Auditors and the independent auditors' report, will be available to the public, within the terms of the law, at the registered office located at Via E. Bazzano 5, 16019 Ronco Scrivia (GE - Italy) as well as by publication on the institutional website www.racingforce.com, Investor Relations section and on the authorized storage mechanism www.emarketsdirstorage.it.
It should be noted that the audit of the draft financial statements has not yet been finalized and that the auditors' report will therefore be made available within the legal deadlines.
This press release is available in the Investor Relations section of the website www.racingforce.com.
[1] EBITDA and adjusted EBIT are calculated net of non-recurring costs amounting to Euro 405 thousand, related to accrued rights for the year 2024 under the stock grant plan for certain Group managers. Furthermore, adjusted net result excludes non-recurring tax income related to the 2020-2023 periods, recognized under the Patent Box tax regime, amounting to Euro 316 thousand.
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