Business

Aston Martin narrows losses as demand picks up

Aston Martin reduced its losses last year as revenues climbed back above pre-epidemic levels, boosted by customer deposits for its high-priced specialty cars and increasing demand for its luxury sports car.

The annual pre-tax losses at the luxury carmaker, which is in the middle of a five-year turning point under Canadian billionaire Lawrence Stroll, have shrunk from £ 466 million to £ 213.8 million.

This is compared to a loss of £ 104 million in 2019, the year before the epidemic, and when the company was in its previous management.

The news caused shares to fall 7% to £ 10.19, the lowest level since July 2020, in the late afternoon in London.

Sales last year rose to £ 1.1 billion from £ 611.8 million, while the average selling price of its cars climbed to £ 150,000, higher both in 2020 and 2019, with the help of the DBX sports car and pricing discipline More.

The company expects a “double-digit” rise in selling prices this year, aided by the powerful DBX707 and the new V12 Vantage, CFO Ken Gregor told the Financial Times.

The two cars, the first to be manufactured by the new team, will have a margin of over 40%, a standard that Aston believes will help a company that is in constant cash become self-financing.

The business is still suffering from high-interest loans taken out in October 2020, which led Aston to pay £ 171 million in financing costs last year compared to £ 75 million a year earlier. The group expects to pay a similar level this year, of which about £ 125 million will be cash, Gregor added.

Stroll said this month that he wants to start repaying the loans when the business starts producing cash, which he expects next year. Gregor confirmed on Wednesday that the company is still expected to lose money this year at the pre-tax level, but aims to be profitable in 2023.

Aston expects car sales to rise to more than 6,600 this year from 6,178 last year. It wants to generate 10,000 a year and generate annual sales of £ 2 billion by the middle of the decade.

Stroll, who led a £ 540million bailout of the company in April 2020, wants to restore Aston’s prestigious approvals by removing excess risky cars, returning the brand to Formula 1 and showcasing a range of mid-range cars that will compete with Ferrari.

During the year the company ordered £ 71 million from customer deposits in the open roof version of its Valkyrie hypercar and for its Valhalla supercar.

In January, Aston said it Delays to its Valkyrie at £ 2.5m Hypercar will cost the business £ 15million. It provided just 10 models last year. On Wednesday, the company said it expects to produce between 75 and 90 of the cars this year, although it added that it is still “arranging” the production process, the CEO said Tobias Morse to FT.

The business intended to produce “two a week, maybe more,” he added. “We just focus on execution.”

Aston Martin narrows losses as demand picks up Source link Aston Martin narrows losses as demand picks up

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