TIDMAML
RNS Number : 2017K
Aston Martin Lagonda Global Hld PLC
04 May 2022
4 May 2022
Aston Martin Lagonda Global Holdings plc
First quarter results for the three months to 31 March 2022
- Management change announced in separate release; new CEO and
CTO
- Q1 performance in-line with expectations; FY 2022 guidance
maintained
- Successfully launched DBX707 ahead of Q2 deliveries; V12
Vantage sold-out
- Strong gross margin driven by pricing, mix and Project Horizon
efficiency actions
GBPm Q1 2022 Q1 2021 % change
-------- --------
Total wholesale volumes(1) 1,168 1,353 (14%)
Revenue 232.7 224.4 4%
Adjusted EBITDA(2) 24.4 20.7 18%
Adjusted operating loss(2) (34.3) (15.3) (124%)
Operating loss (47.7) (15.3) (212%)
Loss before tax (111.6) (42.2) (164%)
Net debt(2) (956.8) (722.9)
---------------------------- -------- -------- ---------
(1) Number of vehicles including specials; (2) For definition of
alternative performance measures please see Appendix;
Financial highlights
-- Retails[1] outpaced wholesales[2] as strong demand continues
across product lines; lower wholesales, as guided, as prepared for
start of DBX707 production and continued supply chain
challenges
-- Revenue increased 4% to GBP233m driven by
- strong pricing dynamics throughout the core portfolio (ASP:
GBP151k vs. Q1 2021: GBP149k); and
- Aston Martin Valkyrie programme deliveries (14 vehicles)
-- Gross margin increased substantially to 36% (Q1 2021: 28%)
reflecting Valkyrie programme deliveries, Project Horizon and
foreign exchange benefit
-- Adjusted EBITDA increased to GBP24m due to higher priced
Specials and cost efficiency benefits from Project Horizon,
partially offset by re-investment into brand and new product launch
activities
- Increased operating loss largely due to higher depreciation
and amortisation, as guided
- Higher net financing charge, driven by GBP38m YoY negative
non-cash FX reval. impact
-- Continued positive cashflow from operations of GBP43m; free
cash outflow[3] of GBP25m includes a working capital inflow of
GBP32m offset by capital expenditure of GBP67m due to investment in
future product pipeline
-- Solid liquidity with cash of GBP404m (December 2021:
GBP419m); Net debt of GBP957m (December 2021: GBP892m), including
the GBP33m impact of non-cash FX revaluation of dollar denominated
debt
Taking-off into a new era for Aston Martin
-- Retail customer demand continues to run ahead of wholesales,
with GT/Sports sold out for the year
-- DBX707, the world's most powerful luxury SUV, launched to
significant customer and media excitement ; DBX orderbook up c.60%
on the prior year
-- New V12 Vantage announced, with all 333 units sold-out by
launch in March following unprecedented demand
-- Racing.Green. , new ESG strategy, launched on Earth Day
reiterating electrification plans; first PHEV deliveries in 2024
and first BEV targeted for launch in 2025
-- Strengthening the team with new senior appointments in
commercial (China), design (exteriors), engineering (Body in White,
vehicle integration and Valkyrie team), quality (suppliers) and
sustainability;
- New CFO Doug Lafferty appointed to the Board 1 May 2022
- New Chief People Officer, Simon Smith appointed on 11 April
2022
Lawrence Stroll, Executive Chairman commented:
"We continue to make tremendous progress, now operating as an
ultra-luxury brand and seeing exceptional demand across our product
range with sports cars sold out for the year and DBX orders up 60%.
Our most recently announced limited-edition, the V12 Vantage, was
fully sold out prior to its official launch in March; and DBX707 is
making headlines as the premier ultra-luxury performance SUV on the
market, generating strong customer interest.
We are poised to deliver good growth in 2022 and remain
extremely confident in the medium and long-term prospects as we
transform Aston Martin into the world's most desirable ultra-luxury
British performance brand."
Outlook
We remain on our journey to achieving our medium-term targets of
c.10,000 wholesales, c.GBP2bn revenue and c.GBP500m adjusted EBITDA
by 2024/25.
For 2022, we expect to deliver significant growth on 2021 with a
c.8% increase in core volumes expected to deliver a c.50%
improvement in adjusted EBITDA from the core business. We will
deliver the first two vehicles from the new management team, DBX707
and the V12 Vantage, with improved profitability compared with
prior models as well as price adjustments across the full
portfolio, given the pricing power of the brand.
In addition, 75-90 Aston Martin Valkyrie programme vehicles
remain on track for shipment.
The global operating environment remains uncertain with the war
in Ukraine, ongoing global COVID-19 lockdowns, most notably in
China, continued supply chain and logistics disruptions, and raw
material cost inflation. Our teams remain focused on minimising any
impact on the Company.
2022 guidance unchanged - updated to reflect prevailing exchange
rates:
-- Wholesales: growth to > 6,600 units
-- Adjusted EBITDA margin: c.350-450bps expansion
-- Capex and R&D: c.GBP300m
-- Depreciation and amortisation: c.GBP315m-GBP330m
Reflecting Aston Martin Valkyrie programme shipments and a full
year of accelerated depreciation of capitalised development costs
ahead of next generation GT/sports vehicles in 2023
-- Interest costs updated for FX movements (assuming GBP:$1.32,
versus previous assumption of GBP:$1.35):
-- c.GBP195m (P&L), GBP25m higher than original guidance of
GBP170m largely driven by non-cash FX reval. of dollar denominated
debt in Q1
-- c. GBP130m (cash), GBP5m higher than original guidance of GBP125m
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.
Enquiries
Investors and Analysts
S herief Bakr Director of Investor Relations +44 (0)7789 177547
sherief .bakr@astonmartin.com
Holly Grainger Deputy Head, Investor Relations +44 (0)7442 989551
holly.grainger@astonmartin.com
Brandon Henderson Senior Manager, Investor +44 (0)7585 326704
Relations brandon.henderson@astonmartin.com
Media
Kevin Watters Director of Communications +44 (0)7764 386683
kevin.watters@astonmartin.com
Paul Garbett Head of Corporate and Brand +44 (0)7501 380799
Communications paul.garbett@astonmartin.com
Grace Barnie Corporate Communications +44 (0)7880 903490
Manager grace.barnie@astonmartin.com
Tulchan Communications
Harry Cameron and Simon Pilkington +44 (0)20 73534200
-- There will be a call for investors and analysts today at 08:30am
-- The conference call can be accessed live via the corporate website https://www.astonmartinlagonda.com/investors/calendar
-- 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.
Sales & Revenue analysis
Total wholesales were lower than the comparative period, as
prepared for start of production of DBX707 at St Athan and
continued to navigate a challenging operating environment.
Wholesales were 1,168 units and included 19 Specials compared with
one Special in Q1 2021. DBX represented 37% of the core mix ahead
of DBX707 deliveries in Q2 2022. DBX is expected to represent over
50% of wholesales going forwards.
By geography, Americas, down 16%, and APAC, down 26%, were
impacted by transportation delays. Our home market of the UK was
impacted the least by supply chain disruptions, down 3% compared to
last year.
Revenues were GBP233m, up 4% over the comparative period, driven
mainly by increased high-value Specials and strong pricing
dynamics.
Retail sales to end customers outpaced wholesales and with price
increases across the range implemented during late 2021, core
average selling price (ASP) improved over the comparative period to
GBP151k (Q1 2021: GBP149k). Total ASP of GBP181k (Q1 2021: GBP151k)
benefited from the increased number and higher price of
Specials.
Income statement
Adjusted EBITDA was GBP24m with a margin of 10% (Q1 2021: GBP21m
with a 9% margin). The operating loss of GBP48m (Q1 2021: GBP15m)
reflected:
-- revenue growth, increased Specials, Project Horizon and
foreign exchange benefits contributing to a gross margin of 36%, a
significant expansion over the comparative period (Q1 2021:
28%)
-- increased brand and key product launch investment, particularly DBX707
-- higher depreciation and amortisation (up GBP23m year-on-year)
principally due to Aston Martin Valkyrie programme deliveries and
accelerated depreciation of capitalised development costs ahead of
next generation GT/Sports vehicles in 2023
-- a GBP5m benefit from exchange rate movements.
Adjusting operating items of GBP13m predominantly related to the
pension scheme closure accrual disclosed at the full year 2022
results (Q1 2021: nil).
Net financing costs of GBP64m were up from GBP27m in the
comparative period, comprising of interest on Senior Secured Notes
outstanding and an FX charge of GBP33m (Q1 2021 included a GBP5m FX
benefit). The GBP11m adjusting finance credit was due to fair value
movements of outstanding warrants (Q1 2021: GBP5m credit). The loss
before tax was GBP113m (Q1 2021: GBP42m).
Cash flow and net debt
Net cash inflow from operating activities was GBP43m (Q1 2021:
GBP72m inflow), driven primarily by a working capital inflow of
GBP32m. The largest driver was a GBP67m payables inflow reflecting
deferred income due to logistics disruptions and ramp-up in
development and timing of development costs. Demand for
limited-edition models remains strong with an GBP12m inflow from
customer deposits.
Capital expenditure of GBP67m was up GBP19m over the comparative
period, with investment expected to increase through the year. This
will be focused on the development of the future product pipeline
including full refreshes of front-engine products as well as
development of the mid-engine programmes.
Free cash outflow of GBP25m; (Q1 2021: inflow of GBP24m),
reflected the increased investment for the future. Cash at 31 March
2022 was GBP404m (31 December 2021: GBP419m) and includes an GBP18m
increase in inventory financing in the period. Interest on all
outstanding notes is paid in Q2 and Q4.
Net debt of GBP957m was up from GBP892m at 31 December 2021
including the GBP33m impact of non-cash FX revaluation of dollar
denominated debt.
APPICES
Wholesale number of vehicles
Q1 2022 Q1 2021 Change
-------- --------
Total 1,168 1,353 (14%)
Core (excluding Specials) 1,149 1,352 (15%)
By region:
UK 264 272 (3%)
Americas 361 431 (16%)
EMEA ex. UK 271 284 (5%)
APAC 272 366 (26%)
By model:
Sport 381 312 22%
GT 347 289 20%
SUV 421 746 (44%)
Other - 5 n.m.
Specials 19 1 n.m.
--------------------------- -------- -------- -------
Note: Sport includes Vantage, GT includes DB11 and DBS, SUV
includes DBX and Other includes prior generation models
Summary Income Statement
GBPm Q1 2022 Q1 2021
--------
Revenue 232.7 224.4
Cost of sales (148.7) (161.1)
-------- --------
Gross profit 84.0 63.3
Gross margin % 36.1% 28.2%
Operating expenses(1) (118.3) (78.6)
of which depreciation & amortisation 58.7 36.0
-------- --------
Adjusted operating loss (2) (34.3) (15.3)
Adjusting operating items (13.4) -
-------- --------
Operating loss (47.7) (15.3)
Net financing expense (63.9) (26.9)
of which adjusting financing income 10.8 5.4
-------- --------
Loss before tax (111.6) (42.2)
Taxation (0.4) 0.4
-------- --------
Loss for the period (112.0) (41.8)
Adjusted EBITDA (1,2) 24.4 20.7
Adjusted EBITDA margin 10.5% 9.2%
Adjusted loss before tax (1) (109.0) (47.6)
------------------------------------------------ -------- --------
1 Excludes adjusting items; 2 Alternative Performance Measures
are defined in the Appendix
Summary Cash Flow
GBPm Q1 2022 Q1 2021
--------
Cash generated from/(used in) operating
activities 43.2 72.2
Cash used in investing activities (excl.
interest received) (66.7) (47.6)
Net cash interest paid (1.9) (0.4)
--------
Free cash inflow/(outflow) (25.4) 24.2
Cash inflow from financing activities
(excl. interest) 5.9 64.4
(Decrease)/Increase in net cash (19.5) 88.6
--------
Effect of exchange rates on cash and cash
equivalents 4.4 (2.6)
------------------------------------------- -------- --------
Cash balance 403.8 575.4
------------------------------------------- -------- --------
Net Debt Overview
GBPm 31-Mar-22 31-Dec-21 31-Mar-21
----------- -----------
Loan notes* (1,113.7)* (1,074.9)* (1,040.5)
Inventory financing (37.8) (19.7) (39.0)
Bank loans and overdrafts (108.1) (114.3) (118.6)
Lease liabilities (IFRS 16) (102.9) (103.4) (101.7)
Gross debt (1,362.5) (1,312.3) (1,299.8)
----------- -----------
Cash balance 403.8 418.9 575.4
Cash not available for short term
use 1.9 1.8 1.5
----------------------------------- ----------- ----------- ----------
Net debt (956.8) (891.6) (722.9)
----------------------------------- ----------- ----------- ----------
*Includes GBP15m issued as PIK interest
Summary Balance Sheet
GBPm 31-Mar-22 31-Dec-21 31-Mar-21
---------- ----------
Non-current assets 1,982.6 1,974.6 1,919.9
Current assets 911.2 867.9 947.5
Total assets 2,893.8 2,842.5 2,867.4
Current liabilities 1,029.1 905.2 855.7
Non-current liabilities 1,310.8 1,276.9 1,248.2
Total liabilities 2,339.9 2,182.1 2,103.9
Total equity 553.9 660.4 763.5
---------- ----------
Alternative performance measures
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 operating loss 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 operating (loss)/profit 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,
cash held not available for short-term
-- 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.
[1] Dealers' sales to customers (some Specials are direct to
customer)
[2] Company sales to dealers (some Specials are direct to
customer)
[3] Operating cashflow less capital investment and net cash
interest; note cash interest payments are in Q2 and Q4
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