Borrowing costs

Aston Martin losses accelerate amid high borrowing costs

Aston Martin losses accelerate amid high borrowing costs, but dealer sales rise as online sales boost demand

  • Aston Martin loss for the third quarter increased amid higher financing costs
  • But third-quarter dealer sales jumped 104%, new figures show

Aston Martin Lagonda’s losses in the third quarter exceeded those recorded in the same period last year, as rising borrowing costs weighed on the luxury automaker.

The third quarter pre-tax loss was £ 97.9million compared to a loss of £ 80.5million for the same period a year ago.

While borrowing costs increased, the group again achieved third quarter sales at dealers jumped 104 percent.

Quarterly loss: Aston Martin Lagonda recorded a larger loss for the third quarter than in the same period last year

The company, which featured four cars in the latest James Bond film “No Time to Die,” said its online car setup tool has tripled sales at dealerships.

In total, the group sold 1,349 cars to dealers during the period and saw sales bolstered by the popularity of its DBX model.

The group said it expects to take its first steps towards improving profitability this year as it undertakes a transformation plan.

It maintained its forecast for annual sales of around 6,000 cars as it ramps up production of its Valkyrie model, with deliveries starting this quarter.

The group said its net debt stood at £ 809million, up from £ 727million a year ago. Its cash reserve stands at around £ 495million, up from £ 489million a year ago.

Last October, the group took out £ 1.1bn of high-interest debt as part of a refinancing plan to give the company a big cash boost.

Between August and October of this year, the group’s financing costs rose to £ 133million, from £ 79million in the previous period.

Excluding significant financing costs, the company’s operating loss was £ 30.2million for the quarter, compared to an operating loss of £ 69.8million at the same point ago. a year.

Executive Chairman Lawrence Stroll said: “In the first nine months of this year, we have successfully built the foundation we have put in place for the company’s success in 2020.

“Not only do we have a low stock of dealers, but it’s also healthy and fresh – a testament to our shift to ultra-luxury positioning. “

Iconic: Aston Martin cars play their role in the latest James Bond film

Iconic: Aston Martin cars play their role in the latest James Bond film “No Time to Die”

Aston Martin shares are currently up 2% or 35.00p to 1787.00p. A year ago, the share price was 1,787.00 pence.

Nicholas Hyett, equity analyst at Hargreaves Lansdown, said: “The demand for Aston Martins is clearly strong – demonstrated not only by the increase in sales but also by the increase in selling prices on its three base models. The increase in marketing spending, especially for events associated with the recently launched F1 team and the new Bond movie, are clearly pounds well spent.

He added: “However, despite the progress, Aston Martin has a long way to go before anything goes well.

“The group remains in deficit and, although it almost achieved positive free cash flow in the third quarter, it depends heavily on the timing of customer spending and deposits.

“Living day to day like this is not a good look for a super luxury brand. As a result, net debt increased significantly during the year, bringing with it an increased financial burden. ‘