Aston Martin Lagonda Global Holdings PLC

Earnings Release • Jul 24, 2019

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RNS Number : 5341G

Aston Martin Lagonda Global Hld PLC

24 July 2019

24 July 2019

This is inside information

Aston Martin Lagonda Global Holdings plc

Trading update and revised outlook

Aston Martin Lagonda today updates its view on trading for FY 2019.

The challenging external environment highlighted in May has worsened, as have macro-economic uncertainties. We anticipate that this softness will continue for the remainder of the year and are planning prudently for 2020.

Accordingly, we expect FY 2019 wholesales to be between 6,300-6,500 vehicles and we will continue to monitor the external environment as we head towards 2020.

Whilst this short-term wholesale correction is disappointing, retail sales have grown by 26% in the first half, production for DBX, our first sports utility vehicle, and Aston Martin Valkyrie remain on plan. During the first half, we have been disciplined, as appropriate for our luxury positioning in maintaining the quality of sales with core wholesales up 9% supporting a continued reduction in dealer inventory as we prepare the network for DBX. In this period, The Americas and APAC have continued to deliver strong growth while UK and European markets have decelerated further.

Wholesales1	Q1-19	Q1-18	Change	Q2-19	Q2-18	Change	H1-19	H1-18	Change
UK	235	259	(9%)	330	424	(22%)	565	683	(17%)
Americas	250	208	20%	450	246	83%	700	454	54%
EMEA ex. UK	211	219	(4%)	279	388	(28%)	490	607	(19%)
APAC	361	277	30%	326	278	17%	687	555	24%
Total	1,057	963	10%	1,385	1,336	4%	2,442	2,299	6%
Core	1,025	915	12%	1,381	1,289	7%	2,406	2,204	9%

1 Number of vehicles

In addition, we have provided £19m against consultancy income recognised in Q2 2018. The commercial position on this contract has deteriorated with significant doubt remaining over the outstanding receivable. This provision will be reported in H1 2019 in Other Income.

We are also taking immediate actions to improve efficiency and reduce our fixed cost base as we head into 2020. 

For FY 2019, we expect adjusted EBITDA margin of ~20% and adjusted operating (EBIT) margin of ~8% reflecting the volume revisions and provision noted above.

DBX is on track with the new St Athan facility now commissioned and manufacturing the first pre-production cars. First orders will be taken at the Pebble Beach Concours d'Elegance, California, in August, with the global launch in December 2019 and start of production is Q2 2020, as planned.

As we continue to invest appropriately in our product expansion, capital expenditure will be re-phased to c.£300m in FY2019.

Dr Andy Palmer, Aston Martin Lagonda President and Group CEO said:

"Whilst retails have grown by 26% year-to-date, our wholesale performance is adversely impacted by macro-economic uncertainty and enduring weakness in UK and European markets. We are disappointed that short-term wholesales have fallen short of our original expectations, but we are committed to maintaining quality of sales and protecting our brand position first and foremost. We are today taking decisive action to manage inventory and the Aston Martin Lagonda brands for the long-term. We remain focused on the successful execution of the Second Century Plan and on delivering sustainable long-term growth."

Interim Results for the six months to 30 June 2019 will be announced on 31 July 2019.

Revised guidance for FY 2019:

·    Wholesales: 6,300-6,500

·    Adjusted EBITDA margin: ~20%

·    Adjusted operating profit (EBIT) margin: ~8%

·    Capex: ~£300m

All metrics and commentary in this announcement exclude adjusting items unless stated otherwise and certain financial data within this announcement have been rounded.

Enquiries

Investors and Analysts

Charlotte Cowley                  Director of Investor Relations                        +44 (0)7771 976764

charlotte.cowley@astonmartin.com 

Media

Kevin Watters                       Director of Communications                          +44 (0)7764 386683

kevin.watters@astonmartin.com

Grace Barnie                        Corporate Communications Manager            +44 (0)7880 903490

grace.barnie@astonmartin.com       

Teneo                                                                                   

Tim Burt, Doug Campbell, Haya Herbert-Burns                                          +44 (0)20 7420 3189

·      There will be a call for investors and analysts today at 07.30am UK time

·      The conference call can be accessed live via a dial-in facility on +44 (0)2075721187; PIN: 11495991#

·      A recording of this call with be available on the corporate website https://www.astonmartinlagonda.com/investors

No representations or warranties, express or implied, are made as to, and no reliance should be placed on, the accuracy, fairness or completeness of the information presented or contained in this release. This release contains certain forward-looking statements, which are based on current assumptions and estimates by the management of Aston Martin Lagonda Global Holdings plc ("Aston Martin Lagonda"). Past performance cannot be relied upon as a guide to future performance and should not be taken as a representation that trends or activities underlying past performance will continue in the future. Such statements are subject to numerous risks and uncertainties that could cause actual results to differ materially from any expected future results in forward-looking statements. These risks may include, for example, changes in the global economic situation, and changes affecting individual markets and exchange rates.

Aston Martin Lagonda provides no guarantee that future development and future results achieved will correspond to the forward-looking statements included here and accepts no liability if they should fail to do so. Aston Martin Lagonda undertakes no obligation to update these forward-looking statements and will not publicly release any revisions that may be made to these forward-looking statements, which may result from events or circumstances arising after the date of this release.

This release is for informational purposes only and does not constitute or form part of any invitation or inducement to engage in investment activity, nor does it constitute an offer or invitation to buy any securities, in any jurisdiction including the United States, or a recommendation in respect of buying, holding or selling any securities. 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.

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