Aston Martin Lagonda see progress but there’s still no time to die
Ayodele Johnson BA (Hons) DipFA
Principal Wealth Manager at Johnson Adviser Wealth Management
Ayodele Johnson
Author/Financial Commentator
09.01.2022
Key Points
-???????Aston Martin Lagonda (AML) have ambitious targets to turn the company’s fortunes around.
-???????Year to date results see’s record-breaking revenue in a challenging environment.
-???????Hybrid and battery electric future, investors should consider this as part of an EV portfolio.?
Aston Martin Lagonda (AML) the performance car manufacturer founded in 1913 and rose to prominence in the 1960s famously known for their handmade performance vehicles and britishness composing of style and elegance. The DB5 model originally featured in the James bond movie franchise Goldfinger and has been an iconic feature ever since. In recent years the company results have been more “shaken not stirred”.
In a bid to turn around the loss-making business, Aston Martin appointed the former Mercedes AMG boss Tobias Moers as Chief Executive Officer in May 2020 at a time when the company was struggling (GBX 669.20 May 15 2020). Financial year end 2020 saw losses before tax of ￡466 million with net debts of ￡726.7 million.
Whilst the share price has somewhat recovered since then (1,370.50p 07.01.2021) it’s a far cry from its 2018 IPO (Initial public offering) offer price of ￡19 per share with an initial market capitalisation of ￡4.33 Billion (03.10.2018).
Recent results for the nine months to 30 September 2021 shows progress with revenue nearly trebled ￡736m for the same period in the previous year ￡270m and loses from operating activity before tax reduced from ￡307.9m to ￡188.6m.???
Lawrence Stroll Executive Chairman said “Through the first nine months of this year (2021) we have successfully built on the foundations we put in place for the company’s success in 2020. Not only do we have low dealer inventory, but it is also healthy and fresh – a testament to our shift to ultra-luxury positioning.
As the automotive industry implement changes to reduce carbon emissions by 2030. The luxury car maker has committed to implementing an ESG (Environmental, Social and Governance) strategy, which includes committing to electrifying their vehicles with battery and hybrid options from 2025 with over 90% of their global portfolio electrified by 2030.
Considering the ambitious targets above It will be interesting to see how Aston Martin Lagonda overcome supply chain issues and semiconductor chip shortages facing car makers alike, forced on due to the global pandemic. Recent delays of the Valkyrie model and the release of the forthcoming Valhalla hybrid model in 2023, will surely test the resilience of the car maker for years to come.
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This article is the opinion of the author only and should not be taken as personal financial advice.
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Research and analysis by Ayodele Johnson