Aston Martin Lagonda Global
Holdings plc
("Aston
Martin", or "AML", or the "Company"; or the "Group")
First quarter results for the
three months ended 31 March 2024
Launch and delivery of four
new models in 2024 to drive significant growth in H2 and
beyond
Successful £1.15bn
refinancing completed on new five-year terms following rating
agency upgrades
70% increase in new Revolving
Credit Facility to £170m from existing lenders
2024 guidance, including
positive FCF inflection in H2'24, and medium-term targets
reiterated
£m
|
Q1 2024
|
Q1 2023
|
% change
|
Total wholesale volumes1
|
945
|
1,269
|
(26%)
|
Revenue
|
267.7
|
295.9
|
(10%)
|
Gross Profit
|
99.7
|
101.9
|
(2%)
|
Gross Margin (%)
|
37.2%
|
34.4%
|
280 bps
|
Adjusted EBITDA2
|
19.9
|
30.2
|
(34%)
|
Adjusted EBIT2
|
(57.1)
|
(47.8)
|
(19%)
|
|
|
|
|
Operating loss
|
(58.7)
|
(50.9)
|
(15%)
|
Loss before tax
|
(138.8)
|
(74.2)
|
(87%)
|
|
|
|
|
Net debt2
|
(1,044.2)
|
(868.1)
|
(20%)
|
1 Number of vehicles including
Specials; 2 For definition of alternative performance
measures please see Appendix
Lawrence Stroll, Aston Martin
Executive Chairman commented:
"2024 is a year of immense product
transformation at Aston Martin, with the introduction of four new
models to the market before the end of the year. Our first quarter
performance reflects this expected period of transition, as we
ceased production and delivery of our outgoing core models ahead of
the ramp up in production of the new Vantage, upgraded DBX707 and
our upcoming V12 flagship sports car which we've confirmed today.
As part of our ongoing programme of ultra-exclusive models, we will
deliver a new Special in the fourth quarter of the year.
"Joining the multi award winning
DB12 Coupe and highly acclaimed DB12 Volante, these 2024 launches
will complete the newest core range in our segment, which along
with the continuation of our Specials, is expected to drive strong
financial delivery and positive free cash flow generation in the
second half of the year and beyond.
"In March, we were pleased to
successfully complete our planned refinancing, securing improved
terms on new five-year senior secured notes. This followed upgrades
from leading credit agencies, recognising the significant progress
made by Aston Martin over recent years and the opportunity for our
strategy to continue to deliver improved performance in the years
to come. This, along with our existing lenders demonstrating their
continued support through a 70% increase in the new RCF to £170m,
marked a significant step in strengthening our balance sheet,
aligning Aston Martin for a positive financial future.
"We were also delighted to announce
in March that Adrian Hallmark will become our new Chief Executive
Officer later in the year. Ensuring a smooth transition in
leadership from Amedeo, Adrian will bring
to Aston Martin unrivalled experience in both the ultra-luxury and
British automotive sectors to further progress our
strategy."
Aston Martin's Chief Financial Officer will host a
Q&A at 8:30am (BST)
today. Details can be found on page 6 of this announcement and
online at www.astonmartinlagonda.com/investors
Wholesale volume summary
Number of vehicles
|
Q1 2024
|
Q1 2023
|
Change
|
Total wholesale
|
945
|
1,269
|
(26%)
|
Core (excluding Specials)
|
900
|
1,251
|
(28%)
|
|
|
|
|
By region:
|
|
|
|
UK
|
154
|
220
|
(30%)
|
Americas
|
303
|
467
|
(35%)
|
EMEA ex. UK
|
283
|
343
|
(17%)
|
APAC
|
205
|
239
|
(14%)
|
|
|
|
|
By model:
|
|
|
|
Sport/GT
|
650
|
582
|
12%
|
SUV
|
250
|
669
|
(63%)
|
Specials
|
45
|
18
|
150%
|
Note: Sport/GT includes Vantage, DB11, DB12, and
DBS
Aston Martin's product
transformation continued at pace during Q1 2024. The introduction of four new models in 2024 and the
transitioning out of the previous ranges remains on track,
resulting in a 26% decline in total
wholesales to 945 (Q1 2023: 1,269). This was driven by:
· Sport/GT wholesales of 650 units increased by 12% (Q1 2023:
582), largely reflecting the cadence of DB12 volumes following the
initial launch peak in Q4 2023.
·
SUV wholesales of 250 decreased
by 63% (Q1 2023: 669), reflecting a transitional ramp down in
volumes ahead of the recently announced launch of the new model
DBX707 with an upgraded interior and infotainment system to match
class-leading performance.
· Specials wholesales of 45 (Q1 2023: 18), comprised of a mature
cadence of 16 Aston
Martin Valkyries (Q1 2023: 18), as well as further Valour
deliveries.
As guided at FY 2023 results, retail
volumes comfortably outpaced wholesale volumes in Q1 2024,
following the unwinding of the timing impact of DB12 deliveries in
December 2023. Aston Martin continues to operate a demand-led
approach, aligned with its ultra-luxury high performance strategy,
and expects annual retail volumes to outpace wholesale
volumes.
Aston Martin will be
uniquely positioned with a fully reinvigorated
core range of models by the end of the year. DB12 continues to receive excellent reviews, including for the
recently launched DB12 Volante, resulting in DB12 orders now
extending into Q4 2024. Given the timing of new product launches in
2024, the remainder of the order book continues to extend into Q3
2024, ahead of dealer demonstrators arriving which are expected to
drive significant future customer demand.
Geographically, volumes in APAC
(excluding China) were broadly flat with Japan continuing to see
strong demand and growth. Following the opening of the brand's
first global flagship location, Q New York, Aston Martin continued its ultra-luxury retail strategy with
the recent opening of a new landmark showroom within the
prestigious luxury hotel, The Peninsula Tokyo. Despite a decrease in wholesale volumes across other regions
during the period of portfolio transitioning, overall volumes
remained well balanced across all regions in Q1.
Revenue and ASP summary
£m
|
Q1 2024
|
Q1 2023
|
% Change
|
Sale of vehicles
|
239.6
|
270.1
|
(11%)
|
Total ASP
(£k)
|
253
|
213
|
19%
|
Core ASP
(£k)
|
176
|
180
|
(2%)
|
Sale of parts
|
20.9
|
20.2
|
3%
|
Servicing of vehicles
|
3.6
|
2.1
|
71%
|
Brand and motorsport
|
3.6
|
3.5
|
3%
|
Total revenue
|
267.7
|
295.9
|
(10%)
|
Q1 2024 total revenue of £268m
decreased by 10% (Q1 2023: £296m), primarily due to the volume
impact of the ongoing transition of Aston Martin's product
portfolio. This was partially offset by an increase in total
Average Selling Price (ASP), reflecting
richer mix resulting from deliveries of Aston Martin Valkyrie
Spider's and Valour limited edition models. The slight decline in
core ASP reflects the prior year period mix benefitting from the
contribution of V12 Vantage and DBS in addition to higher SUV
sales, particularly in China, and year-on-year impact of foreign
exchange. Demand for unique product personalisation continued to
drive increased contribution to core revenue.
Income statement summary
£m
|
Q1 2024
|
Q1 2023
|
Revenue
|
267.7
|
295.9
|
Cost of sales
|
(168.0)
|
(194.0)
|
Gross profit
|
99.7
|
101.9
|
Gross margin %
|
37.2%
|
34.4%
|
|
|
|
Adjusted operating
expenses1
|
(156.8)
|
(149.7)
|
of
which depreciation & amortisation
|
77.0
|
78.0
|
Adjusted EBIT2
|
(57.1)
|
(47.8)
|
Adjusting operating items
|
(1.6)
|
(3.1)
|
Operating loss
|
(58.7)
|
(50.9)
|
|
|
|
Net financing expense
|
(80.1)
|
(23.3)
|
of which adjusting financing expense
|
(26.7)
|
(13.8)
|
Loss before tax
|
(138.8)
|
(74.2)
|
Tax (charge)/credit
|
(0.1)
|
0.4
|
Loss for the period
|
(138.9)
|
(73.8)
|
|
|
|
Adjusted EBITDA1,2
|
19.9
|
30.2
|
Adjusted EBITDA margin
|
7.4%
|
10.2%
|
Adjusted loss before tax1
|
(110.5)
|
(57.3)
|
1
Excludes adjusting items; 2 Alternative Performance Measures are
defined in Appendix
Despite lower revenue and volumes,
gross profit was broadly flat at £100m (Q1 2023: £102m), resulting
in gross margin improving 280 basis points to 37% (Q1 2023: 34%).
This margin improvement reflected benefits from the portfolio
transformation and contribution from Specials.
This was partially offset by higher manufacturing, logistics
and other costs ahead of the anticipated ramp-up in production in
H2'24. The Company continues to target over 40% gross margin from
all new products, aligned with the Company's ultra-luxury strategy.
Adjusted EBITDA decreased by 34% in
Q1 2024 to £20m (Q1 2023: £30m) with adjusted EBITDA margin declining to 7% (Q1 2023: 10%). This
was primarily due to the lower volumes during the
transition period and an 11% increase in adjusted operating
expenses (excluding D&A). While SG&A costs were flat,
this was offset by the phasing of non-capitalised engineering
spend, relating mostly to our future electrification
strategy.
Adjusted EBIT decreased by 19% in Q1
2024 to £(57)m (Q1 2023: £(48)m) with depreciation and amortisation
broadly flat at £77m (Q1 2023: £78m).
Adjusted net financing costs of £53m
(Q1 2023: £10m), increased primarily due to the year-on-year impact
of US dollar debt revaluations, and accelerated amortisation of
fees related to prior loan notes as a result of the successful
refinancing. The £27m net adjusting finance charge (Q1 2023: £14m)
was largely due to movements in fair value of outstanding warrants,
and the redemption premiums associated with the refinancing of the
senior secured notes.
The adjusted loss before tax of
£111m (Q1 2023: £57m loss), reflects the lower adjusted EBIT and
increased adjusted net finance costs.
Cash
flow and net debt summary
£m
|
Q1 2024
|
Q1 2023
|
Cash (used in) operating
activities
|
(61.5)
|
(33.0)
|
Cash used in investing activities
(excl. interest)
|
(86.3)
|
(85.3)
|
Net cash interest paid
|
(42.6)
|
-
|
Free cash outflow
|
(190.4)
|
(118.3)
|
Cash inflow/(outflow) from financing
activities (excl. interest)
|
27.9
|
(54.2)
|
(Decrease)/increase in net cash
|
(162.5)
|
(172.5)
|
Effect of exchange rates on cash and
cash equivalents
|
(0.3)
|
(3.0)
|
Cash balance
|
229.6
|
407.8
|
Available facilities
|
165.6
|
53.0
|
Total cash and available facilities
|
395.2
|
460.8
|
Net cash outflow from operating
activities was £62m (Q1 2023: £33m). The year-on-year increase in
cash flow used in operating activities was primarily driven by a
£10m decrease in adjusted EBITDA, as explained above, and a working
capital outflow of £74m (Q1 2023: £54m outflow). The largest
drivers of working capital outflow were:
· £33m decrease (Q1
2023: £20m decrease) in deposits held, due to the increased volume
of Specials delivered compared to the prior period,
· £59m
decrease in payables following reduction from peak production
volumes in Q4 2023,
· £25m
increase in inventories (Q1 2023: £48m increase) ahead of new
Vantage production,
· which was partially
offset by a decrease in receivables of £43m (Q1 2023: £23m
decrease) following collections from the prior quarter.
Capital expenditure of £86m was
broadly flat compared to the comparative period (Q1 2023: £85m),
with investment focused on the future product pipeline,
particularly the next generation of sports cars, as well as
development of the Company's electrification programme.
Free cash outflow of £190m in Q1
2024 (Q1 2023: £118m outflow), was due to the increase in cash
outflow from operating activities as detailed above, as well as the
cash interest payment of £43m, brought forward from the previous Q2
payment date as part of the Company's refinancing
exercise.
£m
|
|
31-Mar-24
|
31-Dec-23
|
31-Mar-23
|
Loan notes
|
|
(1,140.5)
|
(980.3)*
|
(1,080.8)*
|
Inventory financing
|
|
(38.0)
|
(39.7)
|
(39.0)
|
Bank loans and overdrafts
|
|
0.0
|
(89.4)
|
(57.7)
|
Lease liabilities (IFRS
16)
|
|
(95.3)
|
(97.3)
|
(98.4)
|
Gross debt
|
|
(1,273.8)
|
(1,206.7)
|
(1,275.9)
|
Cash balance
|
|
229.6
|
392.4
|
407.8
|
Net
debt
|
|
(1,044.2)
|
(814.3)
|
(868.1)
|
*Includes £41m and £31m issued as
PIK interest as at 31-Dec-23 and 31-Mar-23, respectively
Compared with 31 December 2023,
gross debt marginally increased to £1,274m (31 December 2023:
£1,207m) as a result of the successful refinancing where, following
upgrades from leading credit agencies, the Group priced on improved
terms senior secured notes of $960m at 10.000% and £400m at 10.375%
due in 2029. In addition, existing lenders entered into a new super
senior revolving credit facility agreement, increasing their
binding commitments by c. £70 million to £170 million. This new
facility provides the Company with additional liquidity as it
continues to accelerate its growth strategy, with total cash and
available facilities of £395m on 31 March 2024, in line with the
position at 31 December 2023. As announced in March 2024, the
proceeds from the offering of the notes, together with cash on the
balance sheet, were used to redeem in full the existing senior
secured notes and second lien split coupon notes, to repay in full
the borrowings under the previous revolving credit facility and
make the early interest payment in March that was due in April
2024.
Net debt of £1,044m increased from
£868m as at 31 March 2023. Given the robust EBITDA performance in
last twelve-month period, the net leverage ratio decreased
year-on-year to 3.5x (Q1 2023: 4.4x).
Outlook
We remain on track to deliver our FY
2024 financial targets announced at our FY 2023 results on 28
February 2024, as we deliver another year
of significant strategic and financial progress, continuing the
ongoing product portfolio transformation:
·
Enhanced profitability and
EBITDA will be driven by high single-digit percentage wholesale
volume growth
·
Gross margin further improving to achieve our
longstanding target of c. 40%
·
EBITDA margin expansion continuing into the low
20s%.
As expected, given the product
transformation and launch timings of four new models in
2024:
· Wholesale volumes
will be heavily weighted to the second half of the year, resulting
in significant H2'24 growth in gross profit and EBITDA compared
with the prior year period
· Q2'24
performance expected to be broadly similar to Q1'24
The following timelines are all on
track and are anticipated to be as follows for our new models in
2024:
·
Vantage and DBX707 - deliveries
before the end of Q2'24 with production ramping up through
H2'24A
· New V12
flagship - deliveries scheduled to begin in Q4'24
· New
ultra-exclusive Special - deliveries scheduled in Q4'24.
Continued capital investment in new
product developments to support our growth strategy is expected to
total c. £350m in 2024, broadly even across the first and second
half of the year. FCF is expected to materially improve in 2024
compared with the prior year, achieving our targeted inflection
point for positive FCF generation in H2'24, primarily driven by the
timing of wholesale volumes.
Through disciplined strategic
delivery, we expect to continue deleveraging, towards our net
leverage ratio target of c. 1.5x in 2024/25. Following our successful refinancing in Q1'24, we now expect
net cash interest of c. £120m in FY24[1].
Depreciation and amortisation forecast remains at c. £400m in
FY24.
The
Group's medium-term outlook for 2027/28, remains
unchanged.
The financial information contained
herein is unaudited.
All metrics and commentary in this
announcement exclude adjusting items unless stated otherwise and
certain financial data within this announcement have been
rounded.
[1] Assuming current exchange
rates prevail for 2024
Enquiries
Investors and Analysts
James Arnold
Head of Investor
Relations
+44 (0) 7385 222347
james.arnold@astonmartin.com
Ella
South
Investor Relations Analyst
+44 (0) 7776 545420
ella.south@astonmartin.com
Media
Kevin
Watters
Director of
Communications
+44 (0) 7764 386683
kevin.watters@astonmartin.com
Paul Garbett
Head
of Corporate & Brand Communications
+44 (0) 7501 380799
paul.garbett@astonmartin.com
FGS Global
James Leviton and Jenny Bahr
+44 (0) 20 7251 3801
Q&A details
· There
will be a Q&A today at 08:30am BST: https://app.webinar.net/9LzoY2dm2NG
· The
Q&A can be accessed live via the corporate website:
https://www.astonmartinlagonda.com/investors/results-and-presentations
· A
replay facility will be available on the website later in the
day
No representations or warranties,
express or implied, are made as to, and no reliance should be
placed on, the accuracy, fairness or completeness of the
information presented or contained in this release. This release
contains certain forward-looking statements, which are based on
current assumptions and estimates by the management of Aston Martin
Lagonda Global Holdings plc ("Aston Martin Lagonda"). Past
performance cannot be relied upon as a guide to future performance
and should not be taken as a representation that trends or
activities underlying past performance will continue in the future.
Such statements are subject to numerous risks and uncertainties
that could cause actual results to differ materially from any
expected future results in forward-looking statements. These risks
may include, for example, changes in the global economic situation,
and changes affecting individual markets and exchange
rates.
Aston Martin Lagonda provides no
guarantee that future development and future results achieved will
correspond to the forward-looking statements included here and
accepts no liability if they should fail to do so. Aston Martin
Lagonda undertakes no obligation to update these forward-looking
statements and will not publicly release any revisions that may be
made to these forward-looking statements, which may result from
events or circumstances arising after the date of this
release.
This release is for informational
purposes only and does not constitute or form part of any
invitation or inducement to engage in investment activity, nor does
it constitute an offer or invitation to buy any securities, in any
jurisdiction including the United States, or a recommendation in
respect of buying, holding or selling any securities.
Alternative Performance Measure
£m
|
Q1 2024
|
Q1 2023
|
Loss before tax
|
(138.8)
|
(74.2)
|
Adjusting operating
expense
|
1.6
|
3.1
|
Adjusting finance expense
|
35.7
|
13.8
|
Adjusting finance
(income)
|
(9.0)
|
-
|
Adjusted EBT
|
(110.5)
|
(57.3)
|
Adjusted finance (income)
|
(2.7)
|
(2.4)
|
Adjusted finance expense
|
56.1
|
11.9
|
Adjusted EBIT
|
(57.1)
|
(47.8)
|
Reported depreciation
|
20.7
|
18.9
|
Reported amortisation
|
56.3
|
59.1
|
Adjusted EBITDA
|
19.9
|
30.2
|
In the reporting of financial
information, the Directors have adopted various Alternative
Performance Measures ("APMs"). APMs should be considered in
addition to IFRS measurements. The Directors believe that these
APMs assist in providing useful information on the underlying
performance of the Group, enhance the comparability of information
between reporting periods, and are used internally by the Directors
to measure the Group's performance.
- Adjusted EBIT
is loss from operating activities before adjusting items
- Adjusted EBITDA
removes depreciation, loss/(profit) on sale of fixed assets and
amortisation from adjusted operating loss
-
Adjusted operating margin is adjusted EBIT divided by
revenue
-
Adjusted EBITDA margin is adjusted EBITDA (as defined above)
divided by revenue
- Adjusted Earnings
Per Share is loss after income tax before adjusting items, divided
by the weighted average number of ordinary shares in issue during
the reporting period
- Net Debt is current and
non-current borrowings in addition to inventory financing
arrangements, lease liabilities recognised following the adoption
of IFRS 16, less cash and cash equivalents and cash held not
available for short-term use
-
Free cashflow is represented by cash
(outflow)/inflow from operating activities plus the cash used in
investing activities (excluding interest received) plus interest
paid in the year less interest received.
About Aston Martin Lagonda:
Aston Martin's vision is to be the
world's most desirable, ultra-luxury British brand, creating the
most exquisitely addictive performance cars.
Founded in 1913 by Lionel Martin and
Robert Bamford, Aston Martin is acknowledged as an iconic global
brand synonymous with style, luxury, performance, and exclusivity.
Aston Martin fuses the latest technology, time honoured
craftsmanship and beautiful styling to produce a range of
critically acclaimed luxury models including the Vantage, DB12,
DBS, DBX and its first hypercar, the Aston Martin Valkyrie. Aligned
with its Racing. Green. sustainability strategy, Aston Martin is
developing alternatives to the Internal Combustion Engine with a
blended drivetrain approach between 2025 and 2030, including PHEV
and BEV, with a clear plan to have a line-up of electric sports
cars and SUVs.
Based in Gaydon, England, Aston
Martin Lagonda designs, creates, and exports cars which are sold in
more than 50 countries around the world. Its sports cars are
manufactured in Gaydon with its luxury DBX SUV range proudly
manufactured in St Athan, Wales. The company is on track to deliver
net-zero manufacturing facilities by 2030.
Lagonda was founded in 1899 and came
together with Aston Martin in 1947 when both were purchased by the
late Sir David Brown, and the company is now listed on the London
Stock Exchange as Aston Martin Lagonda Global Holdings
plc.