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Aston Martin Lagonda Global Holdings PLC on Wednesday lowered volume guidance for 2025, and pledged further cost cuts, after swinging to a loss in the fourth quarter. In response, shares in the Warwickshire, England-based luxury car maker dropped 9.3% to 100.00 pence each in London on Wednesday morning. Aston Martin reported a pretax loss of £60.2 million in the quarter to December, swung from a £20.0 million profit a year prior. For 2024 as a whole, pretax loss was £289.1 million, widened from £239.8 million. Adjusted earnings before interest, tax, depreciation and amortisation fell 11% to £271.0 million in 2024 from £305.9 million in 2023. This was at low-end of guidance provided in November, of between £270 million to £280 million. Gross profit margin in the quarter declined to 35.1% from 45.2%, below consensus of more than 40%. Revenue edged down 0.7% to £589.3 million in the quarter from £593.3 million a year ago, 3% below consensus, taking full-year sales to £1.58 billion, down 3.1% from £1.63 billion in 2023. Core average selling prices declined, partly due to material foreign exchange headwinds, and despite positive contributions from new models. In the fourth quarter, core ASP of £175,000 was down 11% from £196,000 a year prior. Wholesale volumes increased 7.6% to 2,391 in the quarter from 2,222 a year ago, reflecting deliveries from the new core product range. But they fell overall in the year by 8.9% to 6,030 from 6,620, impacted by the timing of new model launches, supply chain disruptions and weaker macroeconomic environment in China. Chief Executive Adrian Hallmark said after a period of product launches, ‘coupled with industry-wide and company challenges, the focus now shifts to operational execution and delivering financial sustainability’. ‘This starts in 2025 where we expect materially improved financial performance to deliver positive adjusted Ebit for the full year and free cash flow in the second half of 2025,’ he added. In 2024, Aston Martin reported a free cash outflow of £392 million compared to the £360 million outflow in 2023. Hallmark said the firm would cut 170 jobs as part of a drive to cut the annual cost base by £25 million. Half of these savings are expected to be realised in 2025, at a cost of £10 million. Presenting a shift in thinking, Hallmark said the firm needs to be realistic in its planning and timing of launches to ensure we meet deadlines in the future. This would prevent ‘disappointing customers’ and impacting on financial performance, he noted. ‘Avoiding significant unnecessary costs and inefficiencies associated with delays and accelerated project timelines is just one example of the benefits from adopting this approach,’ he added. Reflecting this, Aston Martin said total wholesale volume growth in 2025 would be a mid-single-digit percentage compared to consensus for 20% plus growth. The firm expects enhanced profitability and positive adjusted Ebit generation in 2025 and gross margin is expected to improve to around 40% from 36.9% in 2024, below consensus for 42% The group’s medium-term outlook for 2027 to 2028 remains unchanged. Copyright 2024 Alliance News Ltd. All Rights Reserved.
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