Luxury car maker, Aston Martin Lagonda has released its trading results for the first quarter of the year showing revenues of 78.6 million pounds sterling. Total wholesale volumes for the period was 578 units. The car company also announced a successful capital raising of 536 million in the period, amid rumours of a likely bankruptcy.
Aston Martin however recorded an operating loss of 76.7 million pounds. Total wholesale volumes were 45 per cent less first quarter 2019 ,while operating loss last year was a mere 3.2 million pounds.
Given the impact of the Covid-19 pandemic, revenues were also 60 per cent higher last at 196 million pounds compared to the 78.6 million recorded this year .
Commenting on the reults, Aston Martin Lagonda Executive Chairman, Lawrence Stroll said:” While in the short-term, as anticipated, we will have some difficulties due to the onset of COVID-19, having been in the business for a few weeks now I am even more enthusiastic and confident in the multi-year plan that we have set out to bring new and exciting products to market to drive demand and build the Aston Martin brand.
My immediate priority is to rebalance supply and demand, reducing dealer stock. Although nearly all our dealers are compromised and our factories were closed, we are focused on achieving results and delivering our plan. We have made very good progress very quickly, with dealer inventory down 428 units in just one quarter, more than double the level achieved in the whole of 2019..”
In his own remarks on the first quarter results, Aston Martin Lagonda President/ Group CEO,Dr Andy Palmer said: “During this difficult time our primary concern remains the health and safety of our employees and their families, our business partners, customers, and the local communities where we operate. I am particularly proud of the hard work of our people in producing personal protective equipment for frontline NHS workers to whom we all owe an enormous debt of gratitude.”
According to Palmer, “COVID-19 and the resulting global economic shutdown has had a material impact on our performance this quarter.”
But it is not all gloomy as “ during this unprecedented time, we completed a £536m capital raise and continued to implement our exciting strategy to reset and safeguard the long-term future of the business. Part of the reset includes reducing our global dealer inventory to a luxury norm to rebalance supply and demand, to build resilience and profitability for the future. We have made significant progress on this with dealer inventory reducing by 428 units compared to the start of the year,” he said.
A further analysis of the first quarter trading results provided by the company reveals that, Total and core wholesale ASP of £98,000 was impacted by customer and retail financing support for retail sales in quarter as dealer inventory reduces, as well as core product and geographic mix headwinds, compounded by no Specials as planned (Q1 2019: total £160k, core £149k.)
Core retail[1] sales down 31% year-on-year but ahead of wholesales in unit terms as COVID-19 impacted customer demand and the Company destocked dealers; dealer inventories down 428 units since December 2019 (FY 2019: 190 decrease) and Core wholesales[2] were down 44%, as a result of the strategic destocking and the onset of COVID-19; total down 45%, with no Specials as planned (Q1 2019: 32 Specials.)
The regions — APAC (-74%), Americas (-57%), EMEA (-30%) and UK (-3%); China down 86% with no wholesales in January and February, as planned to re-balance dealer inventories.
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