High-potential SMEs

Egm x-rayed: Novamarine posts 80% jump in ebitda

The Olbia-based nautical company in the first half of 2024 reports excellent results and a 23.4% increase in revenue to 15 million

by Valeria Novellini

20 December 2024

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5' min read

Key points

The numbers
Two international trade agreements signed
Targets 2025

5' min read

The tricolour star on its logo has brought it good luck and the Sardinian company Novamarine, which 'landed' (it should be said) at Euronext Growth Milan on 1 August 2024, won the 'Best Ipo' award at the AssoNext Awards, ex aequo with Misitano & Stracuzzi. However, the market is not so far rewarding the Olbia-based company, which operates in the pleasure boating sector (luxury boats up to 30 metres, particularly tenders) and for professional use (boats for patrol and rescue operations). Novamarine's shares are in fact trading almost in line with the offer price of EUR 3.6 per share.

The numbers

This is certainly not due to the financial results, since in the first half of 2024 Novamarine posted a revenue increase of 23.4% to approximately 15 million, (which benefited from both the price effect and the mix of larger yachts), an 80.5% jump in ebitda to €3.3 million (ebitda margin up from 15% to 21.9%), and ebit and net profit more than doubled (from €1.15 million to €2.5 million and from €633.000 to EUR 1.46 million). As at 30/6/2024 (i.e., prior to the IPO), the company showed a net financial debt of EUR 9.9 million, resulting in a Debt/Equity ratio of 0.7 times (i.e., at fully physiological levels).

At the time of the listing, new financial resources amounting to EUR 8.6 million were raised, which will be used to implement the group's strategy (the figures for the first half of 2024 do not yet include the subsidiary Novamarine Service Srl, and the first consolidated financial statements will relate to the entire 2024 financial year). Novamarine's first goal is to expand the Su Arrasolu production plant in order to dedicate an entire area to the production of pleasure boats up to 18 metres, and to open a production site dedicated to the design and production of boats for military use. Both types of boats will also be made with hulls in aluminium, a sustainable and recyclable material, and the development of an electric boat for professional use (research projects and patrolling marine parks) is planned together with university bodies. An expansion of the international presence is also planned, especially in the USA to deseasonalise demand from areas such as the Caribbean and the United Arab Emirates.

Two international trade agreements signed

Novamarine has already implemented some of the lines of development indicated at the time of the listing, and in particular presented at the Genoa Boat Show the new "Navy by Novamarine" line, tenders from 2.7 to 7.8 metres with aluminium hulls (smaller models can be combined with "full electric" engines), which will also be distributed in international markets by the Mercury network used by the Belgian yachting giant Brunswick Marine (present in 25 countries). In the USA, on the other hand, dealer Kitson Yachts will purchase yachts from Novamarine in the BS - Black Shiver (eight high-end models) and RH (three models, with a fibreglass hull) pleasure boat lines, and will resell them directly to exclusively non-Italian customers, taking care of delivery and after-sales services.

The figures for the first half of 2024 obviously refer to a period in which Novamarine was not yet listed, but after its listing on Euronext Growth Milan, in addition to the commercial agreements signed with Brunswick Marine and Kitson Yachts, new orders were also obtained. In August, contracts were signed for the production and sale of six pleasure boats of the BS and RH lines for a total value of €5.9 million with delivery between the end of 2024 and the beginning of 2025. In November, a contract was signed with an international private client for the production and sale of the fourth model of the 20-metre BS 200 line (Novamarine's top of the range) for a value of over €3 million, with delivery scheduled in the second half of 2025 with payment in four tranches based on the progress of work. A 1.5 million BS 140 boat was also sold in the USA and will be delivered in the summer of 2025, and a sporty HD 120 model (425,000 euro outboard dinghy) will be delivered in May 2025 in Sardinia.

Also in November, two contracts were signed, one with a private party in the United States and one with a dealer on the French Riviera, for as many BS 160 16-metre models for a total value of approximately Euro 3 million. The first will be delivered in January 2025 and the second within the first half of 2025; for these vessels too, payment will be made in four tranches on the basis of work progress.

Objectives 2025

Novamarine's outlook for 2025 therefore appears good, although obviously given its activities the company cannot provide precise numerical guidance. As for the share's lacklustre performance, several factors probably contribute to this: the company's small size, the presence of a lively competitive environment (mostly made up of unlisted companies - Sanlorenzo's Bluegame range is an exception - and generally characterised by lower profitability than Novamarine's), and of course the rather low free float, amounting to 20% of the share capital.

The company has a well-known brand in the nautical sector (mainly pleasure boats) and regularly participates in the Luxury sector exhibitions (Genoa, Monte Carlo and Cannes) and the military one in La Spezia. In terms of ESG, it has recently implemented Model 231 and appointed a Supervisory Board, but for the time being it does not draw up sustainability reports (after all, given its size, it does not fall within the scope of the CSRD Directive).

Novamarine is located in the most nautically focused area of Sardinia

The Regional Plan of the Sardinian Tourist Port Network outlines the birth in Su Arrasolu of a new nautical district with a total area of 200,000 square metres, with the establishment of Sno Marine Centre (79 yacht garages from 25 to 30 metres in length), as well as the construction of office garages, crew quarters, shops and workshops and the professional training of motorists, electricians and carpenters, with an expected investment of over 10 million.

This initiative belongs to the Pirro family, the controlling shareholder of Novamarine through Sno Capital Srl. Olbia would thus become a centre of excellence at European level and a reference point in the nautical market. Already today, Olbia has more than 50% of the recreational units registered in Sardinia's maritime districts and counted a total of 5,294 berths as at September 2022 (latest available data), of which, however, only 282 were for boats over 24 metres. The coastal arch Santa Teresa di Gallura - Liori Porto San Paolo, to which Olbia belongs, catalyses 23% of the regional tourist presence and has 3,959 accommodation facilities with a total of 71,177 beds. A recent study by the Department of Economics and Business Sciences of the University of Sassari pointed out that there are more than 3,500 companies active in the pleasure boating sector on the island, which in 2023 generated profits totalling around 15 million (Novamarine made a net profit of just under 1.5 million, thus representing a very important economic reality in the area).

For 2025, the industry forecasting survey conducted by the Confindustria Nautica Studies Office estimates a better trend for shipbuilding production up to 24 metres than for 2024, which for 60% of the companies surveyed is expected to close with revenues falling by between 6% and 30%. But this will certainly not be the case for Novamarine.