Aston Martin Lagonda Global
Holdings plc
("Aston
Martin", or "AML", or the "Company"; or the "Group")
Preliminary results for the
twelve months ended 31 December 2023
Revenue growth of 18%;
driven by robust volumes and record ASPs
Gross margin improved 650bps
to 39.1%; driven by ongoing portfolio
transformation
Adjusted EBITDA increased
61%; margin improved 490 basis points to 18.7%
Strong Q4 performance
delivered record gross margin and adjusted EBITDA in the
quarter
Disciplined strategic
delivery supported ongoing deleveraging; net leverage ratio at
2.7x
Near- and medium-term
guidance maintained
|
£m
|
FY 2023
|
FY 2022
|
% change
|
Q4 2023
|
Q4 2022
|
% change
|
|
Total wholesale volumes1
|
6,620
|
6,412
|
3%
|
2,222
|
2,352
|
(6)%
|
|
Revenue
|
1,632.8
|
1,381.5
|
18%
|
593.3
|
524.3
|
13%
|
|
Gross Profit
|
639.2
|
450.7
|
42%
|
268.4
|
164.5
|
63%
|
|
Gross Margin (%)
|
39.1%
|
32.6%
|
650 bps
|
45.2%
|
31.4%
|
1380 bps
|
|
Adjusted EBITDA2
|
305.9
|
190.2
|
61%
|
174.8
|
110.4
|
58%
|
|
Adjusted
EBIT2
|
(79.7)
|
(117.9)
|
32%
|
55.4
|
10.3
|
438%
|
|
|
|
|
|
|
|
|
|
Operating (loss)/profit
|
(111.2)
|
(141.8)
|
22%
|
34.1
|
6.6
|
417%
|
|
(Loss)/profit before
tax
|
(239.8)
|
(495.0)
|
52%
|
20.0
|
16.3
|
23%
|
|
|
|
|
|
|
|
|
|
Net debt2
|
(814.3)
|
(765.5)
|
(6)%
|
(814.3)
|
(765.5)
|
(6)%
|
1 Number of vehicles
including Specials; 2 For definition of alternative
performance measures please see Appendix
Lawrence Stroll, Aston
Martin Executive Chairman commented:
"In 2023, Aston Martin delivered
significant strategic milestones and further financial progress,
driven by continued strong demand for our ultra-luxury,
high-performance products. The rich mix of sales, driven by our
ongoing commitment to product innovation, supported growth in
average selling prices to record levels. This, combined with our
ongoing portfolio transformation, resulted in a significantly
enhanced gross margin, remaining on track to achieve our
longstanding target of around 40% gross margin in 2024.
"Aligned to our vision of creating
the most comprehensive product portfolio in our segment, we
launched the highly acclaimed DB12 in 2023. We have seen a clear
demonstration of DB12 and our other ultra-luxury vehicles
addressing the growing demand for unique personalised products
driving increased options revenue while also attracting new
customers to the brand.
"Critical to the long-term success
of Aston Martin is the strength of our iconic global brand and
loyal, as well as evolving, customer base. Continued investment in
both the brand and our go-to-market strategy are imperative to our
success. I was extremely proud of our achievements in 2023 which
included our fantastic partnership with the Aston Martin F1® Team,
the global celebration of our historic 110th
anniversary, and continued implementation of our renewed corporate
identity across our network including the opening of our first
ultra-luxury flagship location, Q New York.
"Looking
ahead to 2024, I'm excited by the future development of our product
portfolio with the completion of our line-up of next generation,
front-engine sports cars, including the recently unveiled Vantage,
and the continuation of our Specials programmes. These and other
advancements will support the delivery of the Company's near- and
medium-term financial targets, including positive FCF generation in H2'24, as
we unleash the power of our brand and continue our growth
trajectory."
Aston Martin's management team will host a video webcast presentation at 8am (GMT)
today. Details can be found on page 6 of this announcement and
online at www.astonmartinlagonda.com/investors
2023 Full year financial summary
· Delivered robust wholesale volumes during a period of ongoing
product portfolio transformation:
- FY 2023 wholesale volumes increased 3% to 6,620 (FY 2022:
6,412); driven by 14% Sport/GT growth, reflecting growth in DB12
and DBS 770 Ultimate volumes in H2'23, despite slight delays to the
initial production ramp up of DB12
- As expected, Q4 2023 wholesale volumes increased 54%
sequentially compared with Q3 2023; decreased 6% to 2,222 compared
to prior year period (Q4 2022: 2,352) due to elevated Q4 2022
wholesales
· FY 2023 revenue increased 18% to £1,633m reflecting continued
execution of our growth strategy; enhanced positioning of our
ultra-luxury brand and enriched product portfolio driving growth in
volumes and record average selling prices (ASPs):
- Strong pricing dynamics in the core portfolio and favourable
mix from DBS 770 Ultimate, DBX707, V12 Vantage Roadster and new
DB12:
§ FY 2023
core ASP of £188k, up 6% (FY 2022: £177k)
§ Q4 2023
core ASP of £196k, up 7% (Q4 2022: £184k)
- Higher year-on-year Specials volumes with consistent delivery
of Aston Martin Valkyrie (87 compared to 80
in FY 2022) including deliveries of the first Aston Martin
Valkyrie Spiders, DBR22 and Valour limited edition
models:
§ FY 2023
total ASP of £231k, up 15% (FY 2022: £201k)
§ Q4 2023
total ASP of £255k, up 20% (Q4 2022: £213k); reflecting richer
mix
· Significant increase in gross profit and margin progressing towards longstanding c. 40% target in FY
2024/25; reflecting benefits from the ongoing portfolio
transformation, driving favourable pricing
dynamics, product mix and volumes:
- FY 2023 gross profit increased by 42% to £639m (FY 2022:
£451m); gross margin at 39% (FY 2022: 33%)
- Q4 2023 gross profit increased by
63% to £268m (Q4 2022: £165m); gross margin at 45% (Q4 2022:
31%)
· FY 2023 adjusted
EBITDA increased 61% to £306m (FY 2022: £190m) translating to an
adjusted EBITDA margin increase of 490 basis points to 18.7%;
primarily driven by higher gross profit, partially offset by 26%
increase in adjusted operating expenses, including reinvestments
into brand and marketing activities and inflationary impacts on the
cost base, while recognising £11m relating to upward revaluation of
investment in AMR GP Holdings Limited
· FY
2023 operating loss decreased by 22% to £111m (FY 2022: £142m
loss), including £78m year-on-year increase in depreciation and
amortisation; Q4 2023 operating profit increased to £34m (Q4 2022:
£7m)
· Net
cash inflow from operating activities of £146m (FY 2022: £127m);
Free cash outflow[3] of £360m (FY
2022: £299m outflow) reflecting:
- Q4 free cash outflow of £63m (Q4 2022: £37m inflow) impacted
by timing of DB12 and Valour deliveries in December 2023 with
related receivables unwinding in January 2024
- Higher year-on-year capital expenditure of £397m (FY 2022:
£287m), primarily related
to new models and next generation sports car developments, as
well as development of the Company's electrification programme
including the initial $33m (£27m) payment to Lucid Group, Inc.
(Lucid) relating to the new strategic supply agreement
- Net cash interest payments of £109m (FY 2022:
£139m)
- Working capital outflow of £86m (FY 2022: £15m outflow)
reflecting timing of December deliveries and the
unwinding of customer deposits on delivery of Special wholesales,
partially offset by a reduction in inventory and
payables
· Year-end cash of £392m (2022: £583m), following the
redemption of 50% of the outstanding second lien notes in November
2023
·
Net debt of £814m (2022: £766m),
including a positive £61m impact of non-cash FX revaluation of US
dollar-denominated debt as sterling strengthened against the US
dollar during 2023; disciplined strategic delivery supported
ongoing deleveraging with net leverage ratio improving to 2.7x
(2022: 4.0x)
Operational Overview: Accelerating.Forward.
Amedeo Felisa, Aston Martin
Chief Executive Officer, commented:
"2023 was a landmark year for
Aston Martin's portfolio transformation as we delivered stunning
new products to market including the DBS 770 Ultimate and DB12, the
first of our next generation sports cars, celebrating a new era of
ultra-luxury design and high-performance. The demand for our
110th anniversary special edition Valour also
demonstrated our brand's unique ability to operate at the very
pinnacle of the ultra-luxury segment, something also exemplified by
further Specials such as the DBR22 and Aston Martin Valkyrie. The
momentum and experience our teams have amassed in 2023 to develop
and deliver our ambitious plans is carried into 2024, which along
with further investment in people and facilities, and a relentless
focus on quality and continuous improvement, will support
successful future model launches and our growth
ambitions."
Heightened focus on ultra-luxury and
high-performance
The success of the Company's
ultra-luxury high-performance product portfolio this year is
demonstrated by record total and core ASPs, and strong revenue and
margin growth. In 2023, the Company completed a year-long
celebration of Aston Martin's 110th anniversary, with a
series of unique global events bringing its community of customers
even closer to the brand, culminating in the launch of the
ultra-exclusive Special, Valour. The Company also completed first
deliveries of its highly acclaimed next generation sports car,
DB12. The model was recently awarded "Car of the Year" for 2024 by
Robb Report and confirmed by Autocar magazine as a true "Super GT",
driving reappraisal of Aston Martin amongst new audiences, whilst
engaging loyal customers.
The DBS 770 Ultimate, the most
powerful production Aston Martin ever, was unveiled in January
2023, with all examples sold out before production commenced in
2023. The world's most powerful ultra-luxury SUV, DBX707, continued
to win awards, named 'Best Exclusive & Luxury Car' at the
prestigious Auto vum Joer awards in Luxembourg, and was announced
as the new Official FIA Medical Car of F1®️ in conjunction with the
start of the 2023 World Championship season. The transformational
demand for Aston Martin's high-performance DBX707 since its launch
in 2022, underpins the next phase of the model's evolution, now the
sole SUV model marketed.
In June 2023, the Company proudly
opened the doors to Q New York, its first ultra-luxury
flagship on 450 Park Avenue. The new location brings the highest
levels of the iconic British brand's bespoke service, Q by Aston
Martin, to North America for the very first time, providing the
most sophisticated luxury specification experience available
anywhere in the world.
The Company celebrated the success
of the Aston Martin F1® Team with the release of an exclusive AMR23
Edition DBX707. Named after the brand's 2023 F1® challenger, the
AMR23 Edition creates a DBX707 that shares a racing identity with
both the AMR23 F1® car and the Official Medical Car of F1®. The
Aston Martin F1® Team continued to drive brand visibility and
heightened product consideration, with a 7% increase in website
traffic versus non-race weekends in 2023 and 20% uplift in traffic
to Aston Martin's award-winning configurator. Market research
indicates that 60% of luxury car buyers strongly agree they are
more likely to buy an Aston Martin because of its association with
F1 ®️.
Further strengthening its
high-performance DNA, in October 2023, Aston Martin announced it is
set to enter the 2025 24 Hours of Le Mans Hypercar class with a
racing prototype version of the ultimate Hypercar, the Aston Martin
Valkyrie.
Looking to the year ahead, 2024
sees Aston Martin begin to complete its vision for a world-class
product portfolio, with an incredible line-up of new, front-engine
sports cars, joining the best performance SUV in the luxury
segment. Unveiling the new Vantage in February 2024, the fastest
and most driver focused in the famous nameplate's 74-year history,
is testament to Aston Martin's commitment to delivering a thrilling
driving experience and integrating the very best in motorsport
technologies. This was exemplified by the car's launch on the same
day as the 2024 Aston Martin Formula One® challenger and Vantage
GT3 racer. Complementing the portfolio, the Company has an
incredible, mid-engine supercar in Valhalla on the horizon, with
prototype testing already taking place and currently on course to
enter production before the end of this year.
Aligning the organisation for accelerated
growth
In 2023, the Company delivered the
majority of its vehicles in line with production plans, including
the DBS 770 Ultimate, DBX707 and Special models. During Q3, despite
initial production ramp up delays due to
supplier readiness and EE platform integration issues,
deliveries of DB12 commenced. This model included
Aston Martin's first-ever in-house, bespoke infotainment system,
where teams across the Company collaborated with suppliers to
deliver this significant step forward for the product. Aligned with
the Company's commitment to providing customers with the highest
quality products and best user experience possible, these and other
continual improvement processes will be carried forward into 2024
to support the successful launch of further new models.
In June 2023, the Company moved
further forward in its ambition to create the world's most
thrilling and highly desirable electric performance cars, with the
formation of a landmark new supply agreement with world-leading
electric vehicle technologies company, Lucid Group. This long-term
relationship will help propel Aston Martin's high-performance
electrification strategy, as the Company develops alternatives to
the Internal Combustion Engine with a blended drivetrain approach
between 2025 and 2030, including PHEV and BEV, with a clear plan to
have a line-up of electric sports cars and SUVs. With Aston
Martin's technical partnerships now in place, the Company's first
battery electric vehicle (BEV) is now targeted for launch in 2026,
benefitting from the very best high-performance technologies
available.
In October 2023, a consortium
working on the Company's high-performance electrification strategy
was awarded £9 million of government funding through the Advanced
Propulsion Centre UK, further supplementing the research and
development of Aston Martin's innovative modular BEV platform,
which will be propelled by world-leading electric vehicle
technologies from Lucid.
Continued investment in people, skills and
facilities
At the core of the Group's value
is one single guiding tenet: No one builds an Aston Martin on their
own. In line with this and Aston Martin's growth ambitions, the
Company continued to invest in its world-class team, including the
appointment of Chief Industrial Officer, Chief Procurement Officer,
and BEV Chief Engineer. The Company also welcomed a breadth of new
talent to complement its skilled and passionate team, increasing
employment at its Gaydon headquarters to support the launch of its
next generation of sports cars, as well as an enhanced early
careers intake and senior appointments, notably in the area of
electrification.
In 2023, Aston Martin launched new
company values of Unity, Openness, Trust, Ownership and Courage
through an internal and external campaign; these values are at the
heart of the Company's commitment to make Aston Martin a great
place to work. To solidify its community of people, the Company
expanded its employee engagement programme with new internal
initiatives and events, including a family weekend, which saw more
than 10,000 employees and their friends and family attend. Aligned
with the Company's diversity and inclusion aspirations, progress
was made this year towards the target of having women in 25% of
leadership positions by 2025 and in 30% of leadership positions by
2030.
The Company also announced further
progress in its Racing.Green. sustainability strategy,
using CO₂ emission offsets to establish carbon neutral status for its
Gaydon and St Athan plants. This follows an acceleration towards
the goals established in the strategy announced in 2022, with
targets relating to Carbon Neutral manufacturing facilities,
CO₂ emissions and
energy consumption, and biodiversity improvement updated in
2023.
Continued financial progress is reflected in our unchanged
outlook
We remain on track to
substantially achieve our 2024/25 financial targets in FY 2024.
This is driven by continued strong demand for our products
underpinned by the exciting new next generation launches in 2024 of
Vantage and our final front-engine sports car later in the year.
While recognising the ongoing geopolitical and macro economic
volatility and associated inflationary and supply chain
uncertainties, our world-class teams continue to collaborate with
our partners, seeking to minimise potential impacts on our
operations.
2024 is expected to deliver
another year of significant strategic and financial progress as we
continue the ongoing product portfolio transformation. Enhanced
profitability and EBITDA will be driven by high single-digit
percentage wholesale volume growth, gross margin further improving
to achieve our longstanding target of c. 40% and EBITDA margin
expansion continuing into the low 20s%.
Given the launch timings of our
exciting two next generation sports cars in 2024, wholesale volumes
will be heavily weighted to the second half of the year, resulting
in significant H2'24 growth in gross profit and EBITDA compared
with the prior year period.
Continued capital investment in
new product developments to support our growth strategy is expected
to total c. £350m in 2024, broadly flat across the first and second
half of the year. FCF is expected to materially improve in 2024
compared with the prior year, achieving our targeted inflection
point for positive FCF generation in H2'24, primarily driven by the
timing of wholesale volumes.
Through disciplined strategic
delivery, we expect to continue deleveraging, towards our net
leverage ratio target of c. 1.5x in 2024/25. As previously announced, we expect to refinance our
outstanding debt in the first half of 2024. We are in the advanced
stages of preparation and look forward to launching this process in
due course.
Additional 2024
guidance:
· Depreciation and
amortisation: c. £400m
· Net cash
interest: c. £110m, assuming
current exchange rates prevail for 2024
The Group's medium-term outlook for
2027/28, remains unchanged:
· Revenue: c. £2.5
billion
· Gross margin: mid-40s%
· Adjusted EBITDA: c. £800
million
· Adjusted EBITDA margin: c.
30%
· Free
cash flow: to be sustainably
positive
· Net
leverage ratio: below 1.0x
· Expect to invest: c. £2bn over FY
2023-2027 in long-term growth and transition to
electrification
All metrics and commentary in this
announcement exclude adjusting items unless stated otherwise and
certain financial data within this announcement have been
rounded.
Appointment of Corporate Broker
Aston Martin also announces the
appointment of Goldman Sachs International ("Goldman Sachs") as its
joint Corporate Broker, alongside Barclays Bank PLC ("Barclays"),
with immediate effect.
Enquiries
Investors and Analysts
James Arnold
Head of Investor
Relations
+44 (0) 7385 222347
james.arnold@astonmartin.com
Ella
South
Investor Relations
Analyst
+44 (0) 7776 545420
ella.south@astonmartin.com
Media
Kevin
Watters
Director of
Communications
+44 (0) 7764 386683
kevin.watters@astonmartin.com
Paul
Garbett
Head of Corporate & Brand
Communications
+44 (0) 7501 380799
paul.garbett@astonmartin.com
Teneo
Harry
Cameron
+44 (0) 20 7353 4200
Results Presentation
· There will be a video presentation and Q&A for today at
08.00am GMT: https://app.webinar.net/50XL9z5nrwb
· The
presentation and Q&A can be accessed live via the corporate
website:
https://www.astonmartinlagonda.com/investors/results-and-presentations
· A
replay facility will be available on the website later in the
day
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.
FINANCIAL REVIEW
Wholesale and revenue analysis
|
Number of vehicles
|
FY 2023
|
FY 2022
|
Change
|
Q4 2023
|
Q4 2022
|
Change
|
|
Total wholesale
|
6,620
|
6,412
|
3%
|
2,222
|
2,352
|
(6%)
|
|
Core (excluding
Specials)
|
6,469
|
6,323
|
2%
|
2,139
|
2,313
|
(8%)
|
|
|
|
|
|
|
|
|
|
By region:
|
|
|
|
|
|
|
|
UK
|
1,141
|
1,110
|
3%
|
367
|
416
|
(12%)
|
|
Americas
|
2,037
|
1,980
|
3%
|
620
|
828
|
(25%)
|
|
EMEA ex. UK3
|
1,994
|
1,508
|
32%
|
727
|
628
|
16%
|
|
APAC3
|
1,448
|
1,814
|
(20%)
|
508
|
480
|
6%
|
|
|
|
|
|
|
|
|
|
By model:
|
|
|
|
|
|
|
|
Sport/GT
|
3,530
|
3,104
|
14%
|
1,440
|
920
|
57%
|
|
SUV
|
2,939
|
3,219
|
(9%)
|
699
|
1,393
|
(50%)
|
|
Specials
|
151
|
89
|
70%
|
83
|
39
|
113%
|
Note: Sport/GT includes Vantage, DB11, DB12, and DBS; 3 2022
numbers restated
Total wholesales of 6,620
increased by 3% year-on-year (FY 2022: 6,412), driven by high
demand for DBS 770 Ultimate and DB12, despite expected impacts of
the ongoing product portfolio transition. This included 151
Specials in FY 2023 (FY 2022: 89), comprised of a mature cadence of
87 Aston Martin Valkyries (FY 2022: 80), as well as DBR22 and
initial Valour deliveries, demonstrating the Company's unique
ability to operate at the very highest levels of the luxury
automotive segment and attract new customers and collectors to the
brand.
As expected, total wholesales of
2,222 units in Q4 2023 increased by 54% compared to Q3 2023, though
decreased by 6% year-on-year, due to elevated Q4 2022 SUV
wholesales following the resolution of supply chain and logistics
disruptions in Q2 and Q3 2022.
SUV wholesales remained robust in
FY 2023, with ASPs benefiting from the planned change in mix to
DBX707 in line with the Company's ultra-luxury high-performance
strategy. The DBX707 is now clearly established as the benchmark in
the ultra-luxury SUV segment and represented 71% of SUV wholesales
in FY 2023 (FY 2022: 52%), with volumes increasing 25% in 2023
compared with the prior year. SUV wholesales decreased both on a FY
2023 and Q4 2023 year-on-year basis (9% and 50% decreases,
respectively), reflecting portfolio transition and the previously
mentioned elevated Q4 2022 wholesales following disruptions earlier
in 2022.
Q4 2023 Sport/GT wholesales of
1,440 units increased by 57% (Q4 2022: 920), reflecting
considerable contribution from DB12. The temporary peak in DB12
wholesales reflected partial delays in Q3 2023 deliveries due to
supplier readiness and EE platform integration issues.
Aston Martin continues to operate
a demand-led approach, aligned with its ultra-luxury high
performance strategy. Prior to the initial production ramp up
delays of DB12, retail volumes (retails) were ahead of wholesale
volumes (wholesales) for the year. However, similar to the profile
experienced at the end of 2022, and as a direct result of the
timing of DB12 deliveries in December 2023, wholesales were
temporarily ahead of retails at the end of the year. Following the
unwinding of this position, the Company expects to see retails
outpace wholesales in FY 2024 as it continues the transition to its
next generation of sports cars.
Geographically, wholesale volumes
remained well balanced across all regions. The Americas and EMEA
excluding UK were the largest regions in FY 2023, collectively
representing 61% of total wholesales, driven by strong demand for
DBX707, DBS 770 Ultimate and DB12. In our home market, the UK,
wholesales grew 3% year-on-year, driven by DBS 770 Ultimate and
DB12 deliveries. Finally, FY 2023 wholesale volumes in APAC were
impacted by lower sales in China, which decreased by 47% compared
to 2022, which more than offset growth in wholesale volumes
including DBX707 and DBS 770 Ultimate outside of China. China
continues to be a market where we see significant opportunity for
long-term growth. Wholesale volumes in APAC excluding China were up
12% year-on-year (FY 2022: 10%).
Revenue by category
|
£m
|
FY 2023
|
FY 2022
|
% Change
|
|
Sale of vehicles
|
1,531.9
|
1,291.5
|
19%
|
|
Sale of parts
|
80.0
|
70.8
|
13%
|
|
Servicing of vehicles
|
9.8
|
9.3
|
5%
|
|
Brand and motorsport
|
11.1
|
9.9
|
12%
|
|
Total
|
1,632.8
|
1,381.5
|
18%
|
FY 2023 revenue increased by 18%
to £1.6bn (FY 2022: £1.4bn), primarily due to strong wholesale ASP
growth, with both core and total ASP reaching record levels and, to
a lesser extent, due to higher wholesale volumes. Total ASP of
£231k (FY 2022: £201k) increased by 15% year-on-year, reflecting
richer mix including deliveries of the full range of Aston Martin
Valkyrie models and the 110th anniversary Special,
Valour, and DBR22, as well as higher core ASPs. Core ASP of £188k
(FY 2022: £177k) increased by 6% year-on-year driven by strong
pricing and favourable mix dynamics, despite some foreign exchange
headwinds.
Q4 2023 revenue increased by 13%
to £593m (Q4 2022: £524m), driven by strong ASP growth. Total Q4
2023 ASP of £255k (Q4 2022: £213k) increased by 20%, reflecting
113% increase in Special edition wholesale volumes. Q4 2023 core
ASP of £196k (Q4 2022: £184k) increased by 7%, driven by strong
pricing and favourable mix dynamics from new DB12 and exclusive DBS
770 Ultimate, and despite foreign exchange headwinds in Q4
2023.
Summary income statement and analysis
|
£m
|
FY 2023
|
FY 2022
|
Q4 2023
|
Q4 2022
|
|
Revenue
|
1,632.8
|
1,381.5
|
593.3
|
524.3
|
|
Cost of sales
|
(993.6)
|
(930.8)
|
(324.9)
|
(359.8)
|
|
Gross profit
|
639.2
|
450.7
|
268.4
|
164.5
|
|
Gross margin %
|
39.1%
|
32.6%
|
45.2%
|
31.4%
|
|
|
|
|
|
|
|
Adjusted operating
expenses1
|
(718.9)
|
(568.6)
|
(213.0)
|
(154.2)
|
|
of which depreciation & amortisation
|
385.6
|
308.1
|
119.4
|
100.1
|
|
Adjusted EBIT2
|
(79.7)
|
(117.9)
|
55.4
|
10.3
|
|
Adjusting operating
items
|
(31.5)
|
(23.9)
|
(21.3)
|
(3.7)
|
|
Operating (loss)/profit
|
(111.2)
|
(141.8)
|
34.1
|
6.6
|
|
|
|
|
|
|
|
Net financing
(expense)/income
|
(128.6)
|
(353.2)
|
(14.1)
|
9.7
|
|
of which adjusting financing (expense)/
income
|
(36.5)
|
(20.1)
|
(8.2)
|
(39.1)
|
|
(Loss)/profit before tax
|
(239.8)
|
(495.0)
|
20.0
|
16.3
|
|
Tax credit/(charge)
|
13.0
|
(32.7)
|
13.2
|
(26.0)
|
|
(Loss)/profit for the period
|
(226.8)
|
(527.7)
|
33.2
|
(9.7)
|
|
|
|
|
|
|
|
Adjusted EBITDA1,2
|
305.9
|
190.2
|
174.8
|
110.4
|
|
Adjusted EBITDA margin
|
18.7%
|
13.8%
|
29.5%
|
21.1%
|
|
Adjusted (loss)/profit before
tax1
|
(171.8)
|
(451.0)
|
49.5
|
59.1
|
|
|
|
|
|
|
|
EPS (pence)
|
(30.5)
|
(124.5)
|
|
|
|
Adjusted EPS (pence)
|
(21.4)
|
(114.1)
|
|
|
1 Excludes adjusting items; 2 Alternative Performance
Measures are defined in Appendix
In FY 2023, gross profit of £639m
increased by £189m, or 42% (FY 2022: £451m). This translated to a
gross margin of 39%, expanding by 650 basis points compared to the
prior year (FY 2022: 33%). The gross margin performance reflected
benefits from the ongoing portfolio transformation strategy,
driving favourable pricing dynamics, product mix
and volumes, which was particularly strong in Q4 2023 with a
gross margin of 45% (Q4 2022: 31%). Throughout FY 2023 this was
partially offset by higher manufacturing, logistics and other
costs, as well as FX headwinds. The Company continues to target
over 40% gross margin from future products, aligned with the
Company's ultra-luxury strategy.
Adjusted EBITDA increased by 61%
year-on-year to £306m in FY 2023 (FY 2022: £190m), or by £116m.
This translated to an adjusted EBITDA margin of 19% (FY 2022: 14%),
a year-on-year expansion of approximately 490 basis points.
The year-on-year increase in adjusted EBITDA was
primarily due to higher year-on-year revenue and gross profit, as
described above, partially offset by 26% increase in adjusted
operating expenses including reinvestments into brand and marketing
activities and inflationary impacts on the cost base, while
recognising £11m relating to upward revaluation of investment in
AMR GP Holdings Limited.
The operating loss of £111m
compared to a £142m loss in the prior year. The 22% decrease
year-on-year was primarily driven by:
-
Higher year-on-year gross profit as described above
These factors were partially
offset by:
- A £78m year-on-year
increase in depreciation and amortisation, primarily related to
cadence of Specials delivery, DBS 770 Ultimate and DB12 launch, as
well as full year DBX707 charges
- Increased
investment in brand and product launches such as V12 Vantage, DBS
770 Ultimate, DB12, Valhalla and Valour, and marketing activities
at events such as the Goodwood Festival of Speed, Pebble
Beach, and Las Vegas Grand Prix
-
Higher general costs, including inflationary pressures
Net financing costs of £129m were
down from £353m in 2022, comprising a positive non-cash FX
revaluation impact of £61m, as sterling strengthened against
the US dollar (FY 2022: negative £156m). Adjusting operating
items of £32m (FY 2022: £24m) predominantly related to ERP
implementation costs and one-off legal expenses. The £37m net
adjusting finance charge (FY 2022: £20m) was due to movements in
fair value of outstanding warrants, and financing expenses
associated with the partial repayment of the second lien
notes.
The loss before tax was £240m (FY
2022: £495m loss), an improvement of £255m year-on-year and the
loss for the period was £227m (FY 2022: £528m), an improvement of
£301m year-on-year, both impacted by the significant reduction in
net financing costs related to the US dollar-denominated Senior
Secured Notes.
The tax credit on the adjusted
loss before tax was £13m, and the total effective tax rate for the
period to 31 December 2023 was 5.4% which is predominantly due to
recognising deferred tax on accelerated capital allowances and UK
tax losses, as well as movements in deferred tax on the amount of
interest the Group can deduct for tax purposes.
The weighted average share count
at 31 December 2023 was 748 million, following the placing of new
ordinary shares to Lucid Group, Inc. in November and to Geely
International (Hong Kong) Limited in May. 66 million shares in
relation to the warrants remain outstanding and are exercisable
until 2027, giving an adjusted EPS of (21.4)p (2022:
(114.1)p).
Cash flow and net debt
|
£m
|
FY 2023
|
FY 2022
|
Q4 2023
|
Q4 2022
|
|
Cash generated from operating
activities
|
145.9
|
127.1
|
114.5
|
184.0
|
|
Cash used in investing activities
(excl. interest)
|
(396.9)
|
(286.9)
|
(121.9)
|
(73.5)
|
|
Net cash interest paid
|
(109.0)
|
(139.0)
|
(55.8)
|
(73.7)
|
|
Free cash (outflow)/inflow
|
(360.0)
|
(298.8)
|
(63.2)
|
36.8
|
|
Cash inflow/(outflow) from
financing activities (excl. interest)
|
182.2
|
456.2
|
(80.6)
|
(210.5)
|
|
(Decrease)/increase in net cash
|
(177.8)
|
157.4
|
(143.8)
|
(173.7)
|
|
Effect of exchange rates on cash
and cash equivalents
|
(13.1)
|
7.0
|
(7.6)
|
(14.8)
|
|
Cash balance
|
392.4
|
583.3
|
392.4
|
583.3
|
Net cash inflow from operating
activities was £146m (FY 2022: £127m). The year-on-year change in
cash flow from operating activities was primarily driven by a £116m
increase in adjusted EBITDA, as explained above, and mostly offset
by a working capital outflow of £86m (FY 2022: £15m outflow). The
largest driver was an £82m increase in receivables (FY 2022: nil
movement), driven by timing on the delivery of DB12 and Specials,
as well as higher volumes in December 2023. This was partially
offset by a decrease in inventories of £12m (FY 2022: £78m
increase) due to reduced work-in-progress and finished goods, and a
£51m increase in payables (FY 2022: £82m) due to higher production
in December 2023. Due to the high volume of Specials delivered in
Q4 2023, there was a £66m decrease (FY 2022: £18m decrease) in
deposits held, as balances on accounts unwound in the quarter,
partially offset by ongoing Valour deposit collections.
Capital expenditure was £397m in
2023, an increase of £111m year-on-year, with investment focused on
the future product pipeline, particularly the next generation of
sports cars, as well as development of the Company's
electrification programme including a $33m
(£27m) payment to Lucid in Q4 2023 relating to the new strategic supply
agreement.
Free cash outflow of £360m in 2023
compared to a £299m outflow in 2022, is due to an increase in
capital expenditure as detailed above, partially offset by the
improvement in cash flow from operating activities.
|
£m
|
|
31-Dec-23
|
31-Dec-22
|
|
Loan notes
|
|
(980.3)
|
(1,104.0)
|
|
Inventory financing
|
|
(39.7)
|
(38.2)
|
|
Bank loans and
overdrafts
|
|
(89.4)
|
(107.1)
|
|
Lease liabilities (IFRS
16)
|
|
(97.3)
|
(99.8)
|
|
Gross debt
|
|
(1,206.7)
|
(1,349.1)
|
|
Cash balance
|
|
392.4
|
583.3
|
|
Cash not available for short term
use
|
|
-
|
0.3
|
|
Net debt
|
|
(814.3)
|
(765.5)
|
Cash as at 31 December 2023
includes the remaining £106m of proceeds from August's share
placing, following the redemption of a portion of the outstanding
second lien notes in November, and £95m proceeds from the new
shares issued to Geely International (Hong Kong) Limited in
May.
Net debt of £814m (2022: £766m),
including a positive £61m impact of non-cash FX revaluation of US
dollar-denominated debt as the sterling strengthened against the US
dollar during the year. Disciplined strategic delivery and EBITDA
growth supported ongoing deleveraging with net leverage ratio
improving to 2.7x (2022: 4.0x).
APPENDICES
Dealerships
|
|
|
31 Dec-23
|
31 Dec-22
|
|
UK
|
|
20
|
21
|
|
Americas
|
|
44
|
44
|
|
EMEA ex. UK
|
|
54
|
52
|
|
APAC
|
|
45
|
48
|
|
Total
|
|
163
|
165
|
|
Number of countries
|
|
53
|
54
|
Alternative Performance Measure
|
£m
|
FY 2023
|
FY 2022
|
|
Loss before tax
|
(239.8)
|
(495.0)
|
|
Adjusting operating
expense
|
(31.5)
|
23.9
|
|
Adjusting finance
expense
|
(36.5)
|
(12.5)
|
|
Adjusting finance
(income)
|
-
|
32.6
|
|
Adjusted EBT
|
(171.8)
|
(451.0)
|
|
Adjusted finance
(income)
|
74.3
|
(3.0)
|
|
Adjusted finance
expense
|
(166.4)
|
336.1
|
|
Adjusted EBIT
|
(79.7)
|
(117.9)
|
|
Reported depreciation
|
102.2
|
88.8
|
|
Reported amortisation
|
283.4
|
219.3
|
|
Adjusted EBITDA
|
305.9
|
190.2
|
In the reporting of financial
information, the Directors have adopted various Alternative
Performance Measures ("APMs"). APMs should be considered in
addition to IFRS measurements. The Directors believe that these
APMs assist in providing useful information on the underlying
performance of the Group, enhance the comparability of information
between reporting periods, and are used internally by the Directors
to measure the Group's performance.
-
Adjusted EBIT is loss from operating activities before adjusting
items
- Adjusted
EBITDA removes depreciation, loss/(profit) on sale of fixed assets
and amortisation from adjusted operating loss
-
Adjusted operating margin is adjusted EBIT divided by
revenue
-
Adjusted EBITDA margin is adjusted EBITDA (as defined above)
divided by revenue
-
Adjusted Earnings Per Share is loss after income tax before
adjusting items, divided by the weighted average number of ordinary
shares in issue during the reporting period
- Net Debt is
current and non-current borrowings in addition to inventory
financing arrangements, lease liabilities recognised following the
adoption of IFRS 16, less cash and cash equivalents and cash held
not available for short-term use
- Free
cashflow is represented by cash (outflow)/inflow from operating
activities plus the cash used in investing activities (excluding
interest received) plus interest paid in the year less interest
received.
1
Basis of accounting
Aston Martin Lagonda Global
Holdings plc (the "Company") is a company incorporated in England
and Wales and domiciled in the UK. The Group Financial
Statements consolidate those of the Company and its
subsidiaries (together referred to as the "Group").
The Group Financial Statements have
been prepared and approved by the Directors in accordance with UK
adopted international accounting standards.
The Group Financial Statements have
been prepared under the historical cost convention except
where the measurement of balances at fair value is required as
explained below. The Financial Statements are prepared in
millions to one decimal place, and in sterling, which is the
Company's functional currency.
The financial information set out
does not constitute the Company's financial statements for the
years ended 31 December 2023 or 2022 but is derived from those
financial statements. Financial statements for 2022 have been
delivered to the registrar of companies, and those for 2023 will be
delivered in due course. The auditors have reported on those
accounts. Their reports for both years ended 31 December 2023 and
31 December 2022 were not qualified. Their reports did not contain
a statement under Section 498(2) or (3) of the Companies Act
2006.
Climate change
In preparing the Consolidated
Financial Statements, management have considered the impact of
climate change, particularly in the context of the disclosures
included in the Strategic Report this year and the sustainability
goals, including the stated net-zero targets. Climate change is not
expected to have a significant impact on the Group's going concern
assessment to 30 June 2025 nor the viability of the Group over the
next five years following consideration of the below
points.
- The Group has modelled various scenarios to take account of
the risks and opportunities identified with the impact of climate
change to assess the financial impact on its business plan and
viability.
- The Group has a Strategic Cooperation Agreement with
Mercedes-Benz AG. The agreement provides the Company with access to
a wide range of world-class technologies for the next generation of
luxury vehicles which are planned to be launched through to
2027.
- The Group is developing alternatives to the Internal
Combustion Engine ('ICE') with a blended drivetrain approach
between 2025 and 2030, including Plug-in Hybrid Electric Vehicle
('PHEV') and Battery Electric Vehicle ('BEV'), with a clear plan to
have a line-up of electric sports cars and SUVs. This is supported
by significant planned capital investment of around £2bn in
advanced technologies over the 5 year period from 2024 to 2028,
with investment shifting from ICE to BEV technology.
- The Group has formed a landmark new supply agreement with
world-leading electric vehicle technologies company, Lucid Group,
inc, which will help drive the Group's high-performance
electrification strategy and its long-term growth. The agreement
will see Lucid, a world-leader in the design and manufacture of
advanced electric powertrains and battery systems, supply
industry-leading electric vehicle technologies. Access to Lucid's
current and future powertrain and battery technology will support
the creation of a bespoke, singular BEV platform, suitable for all
product types from hypercar to SUV.
- The Group is leading a six-partner collaborative research and
development project, Project ELEVATION, that was awarded £9.0m of
government funding through the Advanced Propulsion Centre, further
supplementing the research and development of its innovative
modular BEV platform.
The Group's first hybrid supercar,
Valhalla, is on course to enter production in 2024, with its first
BEV targeted for launch in 2026.
Consistent with the above,
management have further considered the impact of climate change on
a number of key estimates within the Financial Statements and has
not found climate change to have a material impact on the
conclusions reached.
Climate change considerations have
been factored into the Directors' impairment assessments of the
carrying value of non-current assets (such as capitalised
development cost intangible assets) through usage of a pre-tax
discount rate which reflects the individual nature and specific
risks relating to the business and the market in which the Group
operates.
In addition the forecast cash flows
used in both the impairment assessments of the carrying value of
non-current assets and the assessment of the recoverability of
deferred tax assets reflect the current energy cost headwinds and
future costs to achieve net-zero manufacturing facilities by 2030
as well as the forecast volumes for both existing and future car
lines given current order books and the assessment of changing
customer preferences.
Going concern
The Group meets its day-to-day
working capital requirements and medium term funding requirements
through a mixture of $1,143.7m First Lien notes at 10.5% which
mature in November 2025, $121.7m of Second Lien split coupon notes
at 15% per annum (8.89 % cash and 6.11% Payment in Kind) which
mature in November 2026, a Revolving Credit Facility (£99.6m) which
matures August 2025, facilities to finance inventory,
a bilateral RCF facility and a wholesale vehicle financing
facility. As previously announced, the Group expects to refinance
the outstanding debt during the first half of 2024, however, the
going concern assessment is not dependent on this occurring. Under
the RCF the Group is required to comply with a leverage covenant
tested quarterly. Leverage is calculated as the ratio of adjusted
EBITDA to net debt, after certain accounting adjustments are made.
Of these adjustments, the most significant is to account for lease
liabilities under "frozen GAAP", i.e. under IAS17 rather than IFRS
16. The Group has complied with its covenant requirements for the
year ended 31 December 2023 and expects to do so for the Going
Concern period.
The Directors have developed
trading and cash flow forecasts for the period from the date of
approval of these Financial Statements through 30 June 2025
(the going concern review period). These forecasts show that the
Group has sufficient financial resources to meet its obligations
as they fall due, including repayment of the current RCF were
it needing to be repaid on 30 June 2025 and to comply with
covenants for the going concern review period. The forecasts
reflect the Group's ultra-luxury performance-oriented strategy,
balancing supply and demand and the actions taken to improve cost
efficiency and gross margin. The forecasts include the costs
of the Group's environmental, social and governance ("ESG")
commitments and make assumptions in respect of future market
conditions and, in particular, wholesale volumes, average selling
price, the launch of new models, and future operating costs. The
nature of the Group's business is such that there can be variation
in the timing of cash flows around the development and launch of
new models. In addition, the availability of funds provided through
the vehicle wholesale finance facility changes as the availability
of credit insurance and sales volumes vary, in total and
seasonally. The forecasts take into account these factors to
the extent that the Directors consider them to represent
their best estimate of the future based on the
information that is available to them at the time of
approval of these Financial Statements.
The Directors have considered a
severe but plausible downside scenario that includes considering
the impact of a 15% reduction in DBX volumes and
a 10% reduction in sports volumes from forecast
levels covering although not exclusively, instances of reduced
volume due to delayed product launches, operating costs
higher than the base plan, incremental working capital
requirements such as a reduced deposit inflows or increased deposit
outflows and the impact of the strengthening of the sterling dollar
exchange rate.
The Group plans to make continued
investment for growth in the period and, accordingly, funds
generated through operations are expected
to be reinvested in the business mainly through new model
development and other capital expenditure. To a certain extent,
such expenditure is discretionary and, in the event of risks
occurring which could have a particularly severe effect on the
Group, as identified in the severe but plausible downside scenario,
actions such as constraining capital spending, working capital
improvements, reduction in marketing expenditure and the
continuation of strict and immediate expense control would be taken
to safeguard the Group's financial position.
In addition, we also considered the
circumstances which would be needed to exhaust the Group's
liquidity over the assessment period, a reverse stress test. This
would indicate that vehicle sales would need to reduce by more
than 15% from forecast levels without any of the above
mitigations to result in having no liquidity. The likelihood of
these circumstances occurring is considered remote both in terms of
the magnitude of the reduction and that over such a long
period, management could take substantial mitigating actions, such
as reducing capital spending to preserve liquidity.
Accordingly, after considering the
forecasts, appropriate sensitivities, current trading and available
facilities, the Directors have a reasonable expectation that the
Group has adequate resources to continue in operational existence
for the foreseeable future and to comply with its financial
covenants, therefore, the Directors continue to adopt the going
concern basis in preparing the Financial Statements.
2
Accounting policies
Adjusting items
An adjusting item is disclosed
separately in the Consolidated Statement of Comprehensive Income
where the quantum, nature or volatility of such items would
otherwise distort the underlying trading performance of the Group,
including where they are not expected to repeat in future periods.
The tax effect is also included.
Details in respect of adjusting
items recognised in the current and prior year are set out in note
5.
Prior year restatement
The Consolidated Statement of
Financial Position as at 1 January 2022 and 31 December 2022 has
been restated to reflect a prior period adjustment in respect of
the deferral of tax relief income received under the Research and
Development Expenditure Credit ('RDEC') regime. The Group
previously recognised the income within Administrative and other
operating expenses in the Consolidated Income Statement, in the
period in which the qualifying expenditure giving rise to the RDEC
claim was incurred. The Group has reassessed the treatment under
IAS 20 in respect of income from RDEC claims where the qualifying
expenditure has been capitalised. For these capitalised expenses,
the RDEC income earned has been deferred to the Consolidated
Statement of Financial Position and will be released to the
Consolidated Income Statement over the same period as the
amortisation of the costs capitalised to which the RDEC income
relates. Where the qualifying expenditure is not capitalised, the
RDEC income will continue to be recognised in the Consolidated
Income Statement in the year the expenditure is incurred,
as has previously been the approach.
The impact of this adjustment is
that as at 1 January 2022 and 31 December 2022, £49.0m of deferred
income has been recognised on the balance sheet split between
current £14.9m and non-current £34.1m Trade and Other Payables with
a corresponding adjustment to retained earnings. There is no
adjustment to the Consolidated Income Statement for the year ended
31 December 2022 as the impact of the adjustment is not
material to that individual year. There is no change to the
Consolidated Statement of Cash Flows as, whilst the accounting
impact of the claim is deferred, there is no change to the timing
of the cash receipt. No change in the corporation tax position is
recognised for the year ended 31 December 2022 in either the
Consolidated Income Statement or Consolidated Statement of
Financial Position, as the recoverability assessment of the Group's
deferred tax position has not been materially changed by this
restatement. As there is no adjustment to the Consolidated Income
Statement and no change in the income tax position, there is no
impact on earnings per share.
Where the notes included in these
Consolidated Financial Statements provide additional analysis in
respect of amounts impacted by the above restatement, the
comparative values presented have been re-analysed on a consistent
basis. The following tables detail the impact on the Consolidated
Statement of Financial Position as at 31 December 2022 and 2021,
respectively.
|
Liabilities
|
As
previously reported 31 December 2022
£m
|
Adjustment
£m
|
Restated
balance
31
December 2022
£m
|
|
Non-current liabilities
|
|
|
|
|
Trade and other payables
|
9.1
|
34.1
|
43.2
|
|
|
|
|
|
|
Current liabilities
|
|
|
|
|
Trade and other payables
|
876.3
|
14.9
|
891.2
|
|
|
|
|
|
|
Capital and reserves
|
|
|
|
|
Retained Earnings
|
(1,184.9)
|
(49.0)
|
(1,233.9)
|
|
|
|
|
|
|
Liabilities
|
As
previously reported 1 January 2022
£m
|
Adjustment
£m
|
Restated
balance
1
January 2022
£m
|
|
Non-current liabilities
|
|
|
|
|
Trade and other payables
|
9.8
|
34.1
|
43.9
|
|
|
|
|
|
|
Current liabilities
|
|
|
|
|
Trade and other payables
|
721.0
|
14.9
|
735.9
|
|
|
|
|
|
|
Capital and reserves
|
|
|
|
|
Retained Earnings
|
(662.4)
|
(49.0)
|
(711.4)
|
|
|
|
|
|
3
Segmental reporting
Operating segments are defined as
components of the Group about which separate financial information
is available and is evaluated regularly by the chief operating
decision-maker in assessing performance. The Group has only one
operating segment, the automotive segment, and therefore no
separate segmental report is disclosed. The automotive segment
includes all activities relating to design, development,
manufacture and marketing of vehicles, including consulting
services; as well as the sale of parts, servicing and automotive
brand activities from which the Group derives its
revenues.
|
Revenue
|
2023
£m
|
2022
£m
|
|
Analysis by category
|
|
|
|
Sale of vehicles
|
1,531.9
|
1,291.5
|
|
Sale of parts
|
80.0
|
70.8
|
|
Servicing of vehicles
|
9.8
|
9.3
|
|
Brands and motorsport
|
11.1
|
9.9
|
|
|
1,632.8
|
1,381.5
|
|
Revenue
|
2023
£m
|
2022
£m
|
|
Analysis by geographical location
|
|
|
|
United Kingdom
|
309.9
|
366.0
|
|
The Americas
|
452.8
|
401.8
|
|
Rest of Europe, Middle East and
Africa
|
547.0
|
260.2
|
|
Asia Pacific
|
323.1
|
353.5
|
|
|
1,632.8
|
1,381.5
|
4
Operating loss
The Group's operating loss is
stated after charging/(crediting):
|
|
2023
£m
|
2022
£m
|
|
Depreciation of property, plant and
equipment
|
91.2
|
80.7
|
|
Depreciation absorbed into
inventory under standard costing
|
(0.9)
|
(2.9)
|
|
Loss on sale/scrap of property,
plant and equipment
|
2.6
|
-
|
|
Depreciation of right-of-use lease
assets
|
9.3
|
11.0
|
|
Amortisation of intangible
assets
|
280.4
|
227.4
|
|
Amortisation released
from/(absorbed into) inventory under standard costing
|
3.0
|
(8.1)
|
|
Depreciation, amortisation and
impairment charges included in administrative and other operating
expenses
|
385.6
|
308.1
|
|
|
|
|
|
(Decrease)/increase in trade
receivable loss allowance - administrative and other operating
expenses
|
(1.3)
|
0.6
|
|
Research and development
expenditure tax credit
|
(23.8)
|
(18.4)
|
|
Net foreign currency
differences
|
0.3
|
8.7
|
|
Cost of inventories recognised as
an expense
|
844.0
|
798.0
|
|
Write-down of inventories to net
realisable value
|
24.2
|
8.9
|
|
Increase in fair value of other
derivative contracts
|
(11.2)
|
(2.3)
|
|
Lease payments (gross of sub-lease
receipts)
|
|
|
|
|
Plant, machinery and IT
equipment*
|
0.3
|
0.7
|
|
Sub-lease receipts
|
Land and buildings
|
(0.4)
|
(0.6)
|
|
Auditor's remuneration:
|
|
|
|
|
|
Audit of these Financial
Statements
|
0.3
|
0.3
|
|
|
Audit of Financial Statements of
subsidiaries pursuant to legislation
|
0.5
|
0.4
|
|
|
Audit-related assurance
|
0.1
|
0.1
|
|
|
Services related to corporate
finance transactions
|
-
|
0.2
|
|
Research and development
expenditure recognised as an expense
|
30.7
|
14.1
|
* Election
taken by the Group to not recognise right-of-use lease assets and
equivalent lease liabilities for short-term and low-value
leases.
|
|
2023
£m
|
2022
£m
|
|
Total research and development
expenditure
|
299.2
|
246.1
|
|
Capitalised research and
development expenditure
|
(268.5)
|
(232.0)
|
|
Research and development
expenditure recognised as an expense
|
30.7
|
14.1
|
5
Adjusting items
|
|
2023
£m
|
2022
£m
|
|
Adjusting operating expenses:
|
|
|
|
ERP implementation
costs1
|
(14.5)
|
(6.9)
|
|
Defined Benefit pension scheme
closure costs2
|
(1.0)
|
(13.5)
|
|
Director settlement and incentive
arrangements7
|
-
|
(3.5)
|
|
Legal settlement and
costs3
|
(16.0)
|
-
|
|
|
|
|
|
|
(31.5)
|
(23.9)
|
|
Adjusting finance income:
|
|
|
|
Foreign exchange gain on financial
instrument utilised during refinance
transactions4
|
-
|
4.1
|
|
Gain on financial instruments
recognised at fair value through Income
Statement5
|
-
|
8.4
|
|
Adjusting finance expenses:
|
|
|
|
Premium paid on the early
redemption of Senior Secured Notes4
|
(8.0)
|
(14.3)
|
|
Write-off of capitalised borrowing
fees and discount upon early settlement of Senior Secured
Notes4
|
(9.5)
|
(16.4)
|
|
Professional fees incurred on
refinancing expensed directly to the Income
Statement4
|
-
|
(1.9)
|
|
Loss on financial instruments
recognised at fair value through Income
Statement5
|
(19.0)
|
-
|
|
|
(36.5)
|
(20.1)
|
|
Total adjusting items before
tax
|
(68.0)
|
(44.0)
|
|
Tax charge on adjusting
items6
|
-
|
-
|
|
Adjusting items after
tax
|
(68.0)
|
(44.0)
|
Summary of 2023 adjusting items
1. In the year ended
31 December 2023, the Group incurred further implementation costs
for a cloud-based Enterprise Resource Planning (ERP) system for
which the Group will not own any intellectual property. £14.5m
(2022: £6.9m) of costs have been incurred in the period under the
service contract and expensed to the Consolidated Income Statement
during the business readiness phase of the project. The project
continued to undergo a phased rollout during 2023, which included
HR, ordering and dealer management, and limited aspects of
purchasing, following the previous migration of finance in 2022.
Due to the infrequent recurrence of such costs and the expected
quantum during the implementation phase, these have been separately
presented as adjusting. The cash impact of this item is a working
capital outflow at the time of invoice payment.
2. On 31 January
2022, the Group closed its Defined Benefit Pension Scheme to future
accrual incurring a past service cost of £2.8m. Under the terms of
the closure agreement, employees were granted cash payments both in
the current year and the following two financial years totalling
£8.7m. These costs have been fully accrued. In addition, the
affected employees were each granted 185 shares incurring a
share-based payment charge of £1.0m during 2022. The terms of the
agreement provide the employees with a minimum guaranteed value for
these shares subject to their ongoing employment with the Group.
The Group will pay the employees a further cash sum as the share
price at 1 February 2024 did not meet this value. The charge
associated with this portion was £1.0m in the year ended 31
December 2022 and is being accounted for in accordance with IFRS2
as a cash settled share-based payment scheme. A cost of £1.0m in
the year ended 31 December 2023 relates to the ongoing minimum
guaranteed value which will crystallise in early 2024.
3. During the year ended 31
December 2023, the Group was involved in two High Court cases
against entities ultimately owned by a former significant
shareholder of the Group. The first involved AMMENA, Aston Martin's
distributor in the Middle East, North Africa and Turkey region.
AMMENA brought a number of claims against the Group, including
claims for debts arising between 2019-2021 when Aston Martin was
acting as AMMENA's agent and several claims that the Group had
acted in bad faith when AMMENA resumed its obligations as
distributor. The Group successfully defended all the bad faith
claims and AMMENA's 2021 debt claim was dismissed. Aston Martin,
however, was unsuccessful in its claim to set off its own
counter-claim that AMMENA (as the region's distributor) should
indemnify the Group in relation to costs incurred in the
termination of a retail dealer, so is required to pay AMMENA's debt
claims for 2019 and 2020 (totalling £5.3m plus interest of £0.6m).
The Group incurred costs of £5.7m in defending AMMENA's claims and
must pay opposition costs of £1.7m. The cash impact of these costs
is a cash outflow in February 2024 as well as working capital
movements during the year ended 31 December 2023 for costs already
incurred. The second case involves claims against a retail
dealership, which is ultimately owned by entities that are
shareholders in one of the Group's subsidiary entities, including
for unpaid debts relating to two agreements from 2015 and 2016. The
final judgement has been handed down (and is in AML's favour on all
material issues), but the consequences of that judgement (including
quantification of the final judgment sum, interest, and costs) has
not yet been determined or ordered by the Court. The Group has
incurred costs of £2.7m in the year which in conjunction with the
other costs above are considered non-recurring in nature as these
are related to historic disputes with former shareholders and not
related to the ongoing business of the Group. Whilst disputes and legal proceedings pending are often
in the normal course of the Group's business, in both these cases
the opposing party has links to companies that were former
significant shareholders of the Group. On that basis the Group has
classified these costs as non-recurring in nature.
4. During the year ended 31
December 2023, the Group repaid $121.7m of Second Lien Senior
Secured Notes ("SSNs"). In repaying the notes prior to their
redemption date, a redemption premium of £8.0m was incurred, of
which the cash impact was incurred in the year ended 31 December
2023. Accelerated amortisation of capitalised borrowing costs and
discount of £10.1m was recognised which is a non-cash
item.
In the year ended 31 December 2022, the Group paid
down $40.3m of First Lien SSNs and $143.8m of Second Lien SSNs. The
early settlement of these notes incurred a redemption premium of
£14.3m and transaction fees of £1.9m and resulted in the
acceleration of capitalised borrowing costs of £16.4m. The cash
impact of the fees and premium are incurred within the year ended
31 December 2022. The acceleration of the borrowing costs is a
non-cash item.
In order to facilitate the repayment in of the
SSNs in 2022, the Group placed a forward currency contract to
purchase US dollars. Due to favourable movements in the exchange
rates, a gain of £4.1m was realised in the Consolidated Income
Statement at the transaction date. The repayment made in 2023 was
not hedged.
5. The Group issued Second
Lien SSNs during the year ended 31 December 2020 which included
detachable warrants classified as a derivative option liability
initially valued at £34.6m. The movement in fair value of the
liability in the year ended 31 December 2023 resulted in a net
loss, including warrant exercises, of £19.0m (2022: gain of £8.4m)
being recognised in the Consolidated Income Statement. There is no
cash impact of this adjustment.
6. In 2023, nil tax has
been recognised as an adjusting item (2022: nil tax) which is not
in line with the standard rate of income tax for the Group of 23.5%
(2022: 19%). This is on the basis that the adjusting items generate
net deferred tax assets (specifically unused tax losses and
interest amounts disallowed under the corporate interest
restriction legislation). These have not been recognised to the
extent that sufficient taxable profits are not forecast (under the
defined planning cycle applied for the recognition of deferred tax
assets) against which the unused tax losses and interest amounts
disallowed under the corporate interest restriction legislation
would be utilised.
Summary of 2022 adjusting items
7. On 14 January
2022, it was announced that Doug Lafferty would be joining the
Group as Chief Financial Officer replacing Ken Gregor who stepped
down from the Board on 1 May 2022. On 4 May, it was
announced that Tobias Moers would be stepping down as Chief
Executive Officer and Chief Technical Officer. Amedeo Felisa was
appointed as Chief Executive Officer and Roberto Fedeli was
appointed as Chief Technical Officer on the same day. The total
cost associated with these changes was £3.5m, of which £1.8m
represents joining incentives, £0.7m represents severance, and
£1.0m comprises social security and other costs. Due to the quantum
of such costs incurred in the period, they have been separately
presented. The cash outflows associated with this expense are
expected to be incurred within a period of 12 months from the
appointment of each individual.
6
Finance income
|
|
2023
£m
|
2022
£m
|
|
Bank deposit and other interest
income
|
13.5
|
3.0
|
|
Foreign exchange gain on borrowings
not designated as part of a hedging relationship
|
60.8
|
-
|
|
Finance income before adjusting
items
|
74.3
|
3.0
|
|
Adjusting finance income items:
|
|
|
|
Foreign exchange gain on financial
instrument utilised during refinance transactions
|
-
|
4.1
|
|
Gain on financial instruments
recognised at fair value through Income Statement
|
-
|
8.4
|
|
Total adjusting finance
income
|
-
|
12.5
|
|
Total finance income
|
74.3
|
15.5
|
7
Finance expense
|
|
2023
£m
|
2022
£m
|
|
Bank loans, overdrafts and senior
secured notes
|
151.3
|
166.0
|
|
Foreign exchange loss on borrowings
not designated as part of a hedging relationship
|
-
|
156.2
|
|
Interest on lease
liabilities
|
4.1
|
4.5
|
|
Net interest expense on the net
Defined Benefit liability
|
2.7
|
1.4
|
|
Interest on contract liabilities
held
|
7.7
|
8.0
|
|
Effect of discounting on long-term
liabilities
|
0.6
|
-
|
|
Finance expense before adjusting
items
|
166.4
|
336.1
|
|
Adjusting finance expense items:
|
|
|
|
Loss on financial instruments
recognised at fair value through Income Statement
|
19.0
|
-
|
|
Premium paid on the early
redemption of Senior Secured Notes
|
8.0
|
14.3
|
|
Write-off of capitalised borrowing
fees upon early settlement of Senior Secured Notes
|
9.5
|
16.4
|
|
Professional fees incurred on
refinancing expensed directly to the Income Statement
|
-
|
1.9
|
|
Total adjusting finance
expense
|
36.5
|
32.6
|
|
Total finance expense
|
202.9
|
368.7
|
8
Taxation
|
|
2023
£m
|
2022
£m
|
|
UK corporation tax on
result
|
0.3
|
0.2
|
|
Overseas tax
|
1.7
|
7.4
|
|
Prior period movement
|
(0.1)
|
-
|
|
Total current income tax
charge
|
1.9
|
7.6
|
|
|
|
|
|
Deferred tax credit
|
|
|
|
Origination and reversal of
temporary differences
|
(15.1)
|
29.4
|
|
Prior period movement
|
0.2
|
(4.3)
|
|
Total deferred tax
(credit)/charge
|
(14.9)
|
25.1
|
|
Total income tax (credit)/charge in
the Income Statement
|
(13.0)
|
32.7
|
|
|
|
|
|
Tax relating to items
(charged)/credited to other comprehensive income
|
|
|
|
Deferred tax
|
|
|
|
Actuarial movement on Defined
Benefit plan
|
-
|
1.7
|
|
Fair value adjustment on cash flow
hedges
|
(1.2)
|
(0.8)
|
|
|
(1.2)
|
0.9
|
|
|
|
|
|
Tax relating to items charged
in equity - deferred tax
|
|
|
|
Effect of equity settled share
based payment charge
|
(0.5)
|
-
|
(a) Reconciliation of the total income tax
(credit)/charge
The tax credit (2022: charge) in
the Consolidated Statement of Comprehensive Income for the year is
lower (2022: higher) than the standard rate of corporation tax in
the UK of 23.5% (2022: 19%). The differences are reconciled
below:
|
|
2023
£m
|
2022
£m
|
|
Loss from operations before
taxation
|
(239.8)
|
(495.0)
|
|
Loss from operations before
taxation multiplied by standard rate of corporation tax in the
UK of 23.5% (2022: 19.0%)
|
(56.3)
|
(94.0)
|
|
Difference to total income tax
(credit)/charge due to effects of:
|
|
|
|
Expenses not deductible for tax
purposes
|
1.2
|
2.0
|
|
Movement in unprovided deferred
tax
|
43.4
|
100.3
|
|
Derecognition of deferred tax
assets
|
-
|
25.6
|
|
Irrecoverable overseas withholding
taxes
|
-
|
0.8
|
|
Adjustments in respect of prior
periods
|
0.1
|
(4.3)
|
|
Difference in UK tax
rates
|
(0.7)
|
1.1
|
|
Difference in overseas tax
rates
|
0.2
|
1.2
|
|
Other
|
(0.9)
|
-
|
|
Total income tax
(credit)/charge
|
(13.0)
|
32.7
|
(b) Tax paid
Total net tax paid during the year
was £5.6m (2022: £6.8m).
(c) Factors affecting future tax charges
The UK's main rate of corporation
tax increased from 19% to 25%, effective from 1 April
2023.
Pillar Two legislation has been
enacted or substantively enacted in certain jurisdictions in which
the Group operates. The legislation will be effective for the
Group's financial year beginning 1 January 2024. The Group has
performed an assessment of the Group's potential exposure to Pillar
Two income taxes. The assessment of the potential exposure to
Pillar Two income taxes is based on the most recent tax filings,
country-by-country reporting and financial statements for the
constituent entities in the Group. Based on the assessment, the
Pillar Two Transitional Safe Harbour provisions are expected to
apply in each jurisdiction the Group operates in, and management is
not aware of any circumstance under which this might change.
Therefore, the Group does not expect a potential exposure to Pillar
Two top-up taxes. The Group has applied the exception in IAS 12
'Income Taxes' to recognising and disclosing information about
deferred tax assets and liabilities related to Pillar Two income
taxes.
9
Earnings per ordinary share
Basic earnings per ordinary share
is calculated by dividing the loss for the year available for
equity holders by the weighted average number of ordinary shares in
issue during the year. 1,017,505 ordinary shares were issued under
the Group's share investment plan. As these shares are held in
trust on behalf of the Group's employees and the Group controls the
trust they have been excluded from the calculation of the weighted
average number of shares.
|
Continuing and total
operations
|
2023
|
2022
|
|
Basic earnings per ordinary share
|
|
|
|
Loss available for equity holders
(£m)
|
(228.1)
|
(528.6)
|
|
Basic weighted average number of
ordinary shares (million)
|
748.2
|
424.7
|
|
Basic loss per ordinary share
(pence)
|
(30.5p)
|
(124.5p)
|
Diluted earnings per ordinary share
is calculated by adjusting basic earnings per ordinary share to
reflect the notional exercise of the weighted average number
of dilutive ordinary share awards outstanding during the year,
including the future technology shares and warrants detailed above.
The weighted average number of dilutive ordinary share awards
outstanding during the year are excluded when including them
would be anti-dilutive to the earnings per share value.
|
Continuing and total
operations
|
2023
|
2022
|
|
Diluted earnings per ordinary share
|
|
|
|
Loss available for equity holders
(£m)
|
(228.1)
|
(528.6)
|
|
Basic weighted average number of
ordinary shares (million)
|
748.2
|
424.7
|
|
Basic loss per ordinary share
(pence)
|
(30.5p)
|
(124.5p)
|
|
|
2023
Number
|
2022
Number
|
|
Diluted weighted average number of
ordinary shares is calculated as:
|
|
|
|
Basic weighted average number of
ordinary shares (million)
|
748.2
|
424.7
|
|
Adjustments for calculation of
diluted earnings per share:1
|
|
|
|
Long-term incentive
plans
|
-
|
-
|
|
Issue of unexercised ordinary share
warrants
|
-
|
-
|
|
Issue of tranche 2
shares
|
-
|
-
|
|
Weighted average number of diluted
ordinary shares (million)
|
748.2
|
424.7
|
1. The number of
ordinary shares issued as part of the long-term incentive plans and
the potential number of ordinary shares issued as part of the 2020
issue of share warrants have been excluded from the weighted
average number of diluted ordinary shares, as including them is
anti-dilutive to diluted earnings per share.
As part of the Strategic
Cooperation Agreement entered into in December 2020 with MBAG,
shares were issued for access to tranche 1 technology.
The Agreement includes an obligation to issue further shares
for access to further technology in a future period. During the
year ended 31 December 2023, the agreement was amended and the
Group is no longer required to issue further shares to
MBAG.
Warrants to acquire shares
in the Company were issued alongside the Second Lien SSNs
in December 2020 which can be exercised from 1 July 2021
through to 7 December 2027. As a consequence of the
rights issue during the period ended 31 December 2022 the number of
ordinary shares issuable via the options was increased by a
multiple of 6 to ensure the warrant holders' interests
were not diluted. As at 31 December 2023, 66,159,325 options,
each entitled to 0.3 ordinary shares, remain unexercised. The
future issuance of warrants may have a dilutive effect in future
periods if the Group generates a profit.
Adjusted earnings per share is
disclosed in note 14 to show performance undistorted by adjusting
items to assist in providing useful information on the underlying
performance of the Group and enhance the comparability of
information between reporting periods.
10
Net debt
The Group defines net debt as
current and non-current borrowings in addition to inventory
repurchase arrangements and lease liabilities, less cash and cash
equivalents including cash held not available for short-term
use.
|
|
2023
£m
|
2022
£m
|
|
Cash and cash
equivalents
|
392.4
|
583.3
|
|
Cash held not available for
short-term use
|
-
|
0.3
|
|
Inventory repurchase
arrangement
|
(39.7)
|
(38.2)
|
|
Lease liabilities -
current
|
(8.8)
|
(7.4)
|
|
Lease liabilities -
non-current
|
(88.5)
|
(92.4)
|
|
Loans and other borrowings -
current
|
(89.4)
|
(107.1)
|
|
Loans and other borrowings -
non-current
|
(980.3)
|
(1,104.0)
|
|
Net debt
|
(814.3)
|
(765.5)
|
|
|
|
|
|
Movement in net debt
|
|
|
|
Net (decrease)/increase in cash and
cash equivalents
|
(190.9)
|
164.4
|
|
Add back cash flows in respect of
other components of net debt:
|
|
|
|
New borrowings
|
(11.5)
|
-
|
|
Proceeds from inventory repurchase
arrangement
|
(38.0)
|
(75.7)
|
|
Repayment of existing
borrowings
|
129.7
|
172.7
|
|
Repayment of inventory repurchase
arrangement
|
40.0
|
60.0
|
|
Lease liability payments
|
7.9
|
10.0
|
|
Movement in cash held not available
for short-term use
|
(0.3)
|
(1.5)
|
|
(Increase)/decrease in net debt
arising from cash flows
|
(63.1)
|
329.9
|
|
Non-cash movements:
|
|
|
|
Foreign exchange gain/(loss) on
secured loan
|
60.8
|
(156.2)
|
|
Interest added to debt
|
(14.2)
|
(15.7)
|
|
Borrowing fee
amortisation
|
(26.9)
|
(25.4)
|
|
Lease liability interest
charge
|
(4.1)
|
(4.5)
|
|
Lease modifications
|
(0.6)
|
(3.5)
|
|
New leases
|
(5.8)
|
(2.2)
|
|
Foreign exchange gain and other
movements
|
5.1
|
3.7
|
|
(Increase)/decrease in net
debt
|
(48.8)
|
126.1
|
|
Net debt at beginning of the
year
|
(765.5)
|
(891.6)
|
|
Net debt at the end of the year
|
(814.3)
|
(765.5)
|
11
Share capital and other reserves
|
Allotted, called up and fully
paid
|
Number of
shares
|
Nominal
value
£
|
Share
capital
£m
|
Share
premium
£m
|
Merger
reserve
£m
|
Capital redemption
reserve
£m
|
|
Opening balance at 1 January 2022
|
116,459,513
|
|
11.6
|
1,123.4
|
143.9
|
9.3
|
|
Private
placing1
|
23,291,902
|
0.1
|
2.4
|
75.7
|
-
|
-
|
|
Rights issue2
|
559,005,660
|
0.1
|
55.9
|
498.3
|
-
|
-
|
|
|
|
|
|
|
|
|
|
Balance as at 31 December 2022
and 1 January 2023
|
698,757,075
|
|
69.9
|
1,697.4
|
143.9
|
9.3
|
|
Private
placing3
|
28,300,000
|
0.1
|
2.8
|
91.7
|
-
|
-
|
|
Issuance of shares to
SIP4
|
1,017,505
|
0.1
|
0.1
|
-
|
-
|
-
|
|
Exercise of warrant
options5
|
8,990,975
|
0.1
|
0.9
|
14.1
|
-
|
-
|
|
Placing6
|
58,245,957
|
0.1
|
5.9
|
206.9
|
-
|
-
|
|
Consideration
shares7
|
28,352,273
|
0.1
|
2.8
|
84.4
|
-
|
-
|
|
|
|
|
|
|
|
|
|
Closing balance at 31 December 2023
|
823,663,785
|
|
82.4
|
2,094.5
|
143.9
|
9.3
|
1. On 9 September 2022 the
Company issued 23,291,902 ordinary shares by way of a private
placing. The shares were issued at 335p raising gross proceeds of
£78.1m, with £2.4m recognised as share capital and the remaining
£75.7m recognised as share premium.
2. On 28 September 2022 the
Company issued 559,005,660 ordinary shares by way of a rights
issue. The shares were issued at 103p raising gross proceeds of
£575.8m, with £55.9m recognised as share capital and the remaining
£519.9m recognised as share premium. Share premium is reduced by
£21.6m reflecting transaction fees paid of which £2.9m are accrued
as at 31 December 2022. Due to the shares being issued at
substantially below market price, a bonus issue is deemed to have
taken place. A total of 211.6m shares issued were considered bonus
shares. The weighted average shares used to calculate earnings per
share (see note 11) has been adjusted accordingly.
3. On 26 May 2023 the
Company issued 28,300,000 ordinary shares by way of a private
placing. The shares were issued at 335p raising gross proceeds of
£94.8m with £2.8m recognised as share capital and the remaining
£92.0m recognised as share premium. Transaction fees of £0.3m were
deducted from share premium.
4. On 30 May 2023 the
Company issued 1,017,505 ordinary shares under the Company's Share
Incentive Plan at nominal value. A transfer from retained earnings
of £0.1m took place, with £0.1m recognised in share
capital.
5. On 4 July
2023 3,686,017 ordinary shares were issued to satisfy the
redemption of certain warrant options. Further issuances of
3,980,921 ordinary shares on 12 July 2023 and 1,324,037 ordinary
shares on 31 July 2023 took place. These transactions resulted in
the recognition of £0.9m of share capital with the balance of
£14.1m being recognised in share premium.
6. On 1 August 2023 the
Company issued a total of 58,245,957 ordinary shares comprising
56,750,000 placing shares, 1,078,168 retail offer shares and
417,789 Director subscription shares. The shares were issued at
371p raising gross proceeds of £216.1m, with £5.9m recognised as
share capital, the remaining £210.2m as share premium, offset by
£3.3m of fees.
7. On 6 November 2023 the
Company issued consideration shares to Lucid Group, Inc. in part
payment for access to technology. The fair value of technology was
evaluated which determined the issue price of the shares. £2.8m was
recognised in share capital with an initial £85.8m in share
premium. £1.4m of transaction fees were then deducted from share
premium.
12
Related party transactions
Transactions between Group
undertakings, which are related parties, have been eliminated on
consolidation and accordingly are not disclosed.
Transactions with Directors and related
undertakings
Transactions during 2023
During the year ended 31 December
2023, a net marketing expense amounting to £19.4m of sponsorship
has been incurred in the normal course of business with AMR GP
Limited ("AMR GP"), an entity indirectly controlled by a member of
the Group's Key Management Personnel ("KMP"). AMR GP
and its legal structure is separate to that of the Group
and the Group does not have control or significant influence over
AMR GP or its affiliates. £0.7m remains due from AMR GP at 31
December 2023 relating to these transactions.
During the year ended 31 December
2023 the Group extended its sponsorship arrangements with AMR GP
for a further period of five years commencing in 2026. Amounts
under this arrangement are due within each financial year from
2026. The Group also exercised its primary warrant option and
subscribed for reward shares under the terms of the original
sponsorship arrangement giving the Group a minority stake in AMR GP
Holdings Limited, the immediate parent company of AMR GP limited.
The Group paid nominal value for the shares of which £nil was
outstanding at year end. Under the terms of the sponsorship
agreement the Group is required to provide one fleet vehicle to the
two AMR GP racing drivers free of charge. This arrangement
is expected to continue for the life of the contract and is
not expected to materially affect the financial position and
performance of the Group. One of the racing drivers is an immediate
family member of one of the Group's KMP. A separate immediate
family member of one of the Group's KMP incurred costs of less than
£0.1m relating to the export and transport of a vehicle. The
services were provided by a Group company. £nil was outstanding at
31 December 2023.
In addition, the Group incurred
costs of £8.5m associated with engineering design on two upcoming
vehicle programmes from Aston Martin Performance Technologies
Limited ("AMPT") of which £2.8m is outstanding to AMPT at 31
December 2023. AMPT is an associated entity of AMR GP.
During the year ended 31 December
2023, Classic Automobiles Inc. purchased a vehicle for £1.8m of
which £nil was outstanding at 31 December 2023. Classic Automobiles
Inc. is controlled by a member of the Group's KMP.
During the year ended 31 December
2023, a separate member of the Group's KMP and Non-Executive
Director purchased a vehicle for £1.8m, having paid a deposit to
the Group in the first half of the year. £nil was outstanding at 31
December 2023.
On 26 June 2023, the Group
announced a strategic supply arrangement with Lucid Group, Inc.
("Lucid") for future access to powertrain components for future BEV
models. The arrangement is considered a Related Party Transaction
owing to the substantial ownership of Lucid by the Public
Investment Fund ("PIF"). PIF are also a substantial shareholder of
the Group and two members of the Group's KMP & Non-Executive
Directors are members of PIF's KMP. The Group recognised an asset
of £188.5m in relation to the supply agreement. The agreement is
part-settled in equity, which was issued to Lucid in November 2023.
An outstanding cash liability of £71.7m relating to the supply
arrangement remains at 31 December 2023, all of which is due in
more than one year. The supply arrangements, commit to an effective
future minimum spend with Lucid on powertrain components of
£177.0m.
During the year ended 31 December
2023, the Group incurred costs of £2.0m for design and engineering
work from Pininfarina S.p.A. A member of the Group's KMP and
Non-Executive Director is also a member of Pininfarina S.p.A's KMP.
As of 19 May 2023 the individual ceased to be a member of the
Group's KMP and therefore any future spend under the contract will
not be disclosed as a related party transaction. £nil is
outstanding as at 31 December 2023.
During the year ended 31 December
2023, the Group incurred a rental expense of £1.2m from Michael
Kors (USA), Inc., a Company which is owned by Capri Holdings
Limited. A member of the Group's KMP and Non-Executive Director is
also a member of Michael Kors (USA), Inc.'s KMP.
During the year ended 31 December
2023, the Group incurred consultancy costs of £0.2m from a member
of the Group's KMP and Non-Executive Director in relation to the
oversight of two significant legal claims which the Group has been
party to. £0.1m was outstanding as at 31 December 2023. Owing to
the unique experience of the individual involved and the specifics
of the legal claims, no detailed market price assessment was
performed when engaging this service.
During the year ended 31 December
2023, an immediate family member of the Group's KMP &
Non-Executive Director provided event services at the opening of Q
New York totalling less than £0.1m of expense. £nil was outstanding
at 31 December 2023. No detailed market price assessment was
performed when engaging this service.
Transactions during 2022
During the year ended 31 December
2022, a net marketing expense amounting to £20.2m of sponsorship
has been incurred in the normal course of business with AMR GP
Limited ("AMR GP"), an entity indirectly controlled by a member of
the Group's Key Management Personnel ("KMP"). AMR GP
and its legal structure is separate to that of the Group
and the Group does not have control or significant influence over
AMR GP or its affiliates. In addition, the Group incurred costs of
£2.0m associated with engineering design on an upcoming vehicle
programme from Aston Martin Performance Technologies Limited
("AMPT") of which £2.0m is outstanding to AMPT at 31 December 2022.
AMPT is an associated entity of AMR GP. In addition, AMR GP
acquired a vehicle from the Group at a total cost of £0.7m. Less
than £0.1m remains due from AMR GP at 31 December 2022 relating to
these transactions. Under the terms of the sponsorship agreement
the Group is required to provide one fleet vehicle to the two AMR
GP racing drivers free of charge. This arrangement is expected
to continue for the life of the contract and is not expected to
materially affect the financial position and performance of the
Group. One of the racing drivers is an immediate family member of
one of the Group's KMP. A separate immediate family member of one
of the Group's KMP purchased two vehicles from a Group company for
£0.4m. £nil is outstanding at 31 December 2022. During the year
ended 31 December 2022, Classic Automobiles Inc. placed a deposit
of £0.5m with a Group company for the future purchase of a Group
vehicle. Classic Automobiles Inc. is controlled by a member of the
Group's KMP.
During the year ended 31 December
2022, a separate member of the Group's KMP and Non-Executive
Director placed a deposit of £1.5m with a Group company for the
future purchase of a vehicle.
During the year ended 31 December
2022, a further separate member of the Group's KMP and
Non-Executive Director transacted with a Group company
to undertake service work on a vehicle for a total cost of
less than £0.1m. £nil was outstanding at 31 December
2022.
During the year ended 31 December
2022, the Group incurred costs of £1.3m for design and engineering
work from Pininfarina S.p.A. A member of the Group's KMP and
Non-Executive Director is also a member of Pininfarina S.p.A's
KMP.
During the year ended 31 December
2022, the Group incurred a rental expense of £0.7m from Michael
Kors (USA), Inc., a Company which is owned by Capri Holdings
Limited. A member of the Group's KMP and Non-Executive Director is
also a member of Michael Kors (USA), Inc.'s KMP.
Terms and conditions of transactions with related
parties
Sales and purchases between related
parties were made at normal market prices unless otherwise stated.
Outstanding balances with entities other than subsidiaries are
unsecured and interest free and cash settlement is expected within
60 days of invoice. Terms and conditions for transactions with
subsidiaries are the same, with the exception that balances are
placed on inter-company accounts. The Group has not provided or
benefited from any guarantees for any related party receivables or
payables.
13
Contingent liabilities
In the normal course of the Group's
business, claims, disputes, and legal proceedings involving
customers, dealers, suppliers, employees or others are pending or
may be brought against Group entities arising out of current or
past operations. There is presently a dispute between the Group and
the other shareholders of one of its subsidiary entities, which is
ongoing and from which a future obligation may arise. The Group
denies the claims made and is working to resolve the
matter.
14
Alternative performance measures
In the reporting of financial
information, the Directors have adopted various Alternative
Performance Measures ("APMs"). APMs should be considered in
addition to IFRS measurements. The Directors believe that these
APMs assist in providing useful information on the underlying
performance of the Group, enhance the comparability of information
between reporting periods, and are used internally by the Directors
to measure the Group's performance.
The key APMs that the Group focuses
on are as follows:
i)
Adjusted EBT is the profit/(loss) before tax and adjusting items as
shown in the Consolidated Income Statement.
ii)
Adjusted EBIT is operating profit/(loss) before adjusting
items.
iii)
Adjusted EBITDA removes depreciation, profit/(loss) on sale of
fixed assets and amortisation from adjusted EBIT.
iv) Adjusted
operating margin is adjusted EBIT divided by revenue.
v) Adjusted
EBITDA margin is Adjusted EBITDA (as defined above) divided by
revenue.
vi) Adjusted
earnings per share is loss after tax before adjusting items as
shown in the Consolidated Income Statement, divided by the weighted
average number of ordinary shares in issue during the reporting
period.
vii) Net debt is
current and non-current borrowings in addition to inventory
repurchase arrangements and lease liabilities, less cash and
cash equivalents and cash held not available for short-term use as
shown in the Consolidated Statement of Financial
Position.
viii) Adjusted leverage
is represented by the ratio of net debt to the last 12 months (LTM)
Adjusted EBITDA.
ix) Free cash
flow is represented by cash inflow/(outflow) from operating
activities less the cash used in investing activities (excluding
interest received) plus interest paid in the year less interest
received.
Consolidated Income Statement
|
|
2023
£m
|
2022
£m
|
|
Loss before tax
|
(239.8)
|
(495.0)
|
|
Adjusting operating expenses (note
5)
|
31.5
|
23.9
|
|
Adjusting finance income (notes 5,
6)
|
-
|
(12.5)
|
|
Adjusting finance expense (notes 5,
7)
|
36.5
|
32.6
|
|
Adjusted loss before tax (EBT)
|
(171.8)
|
(451.0)
|
|
Adjusted finance income (note
6)
|
(74.3)
|
(3.0)
|
|
Adjusted finance expense (note
7)
|
166.4
|
336.1
|
|
Adjusted operating loss (EBIT)
|
(79.7)
|
(117.9)
|
|
Adjusted operating margin
|
(4.9%)
|
(8.5%)
|
|
Reported depreciation
|
102.2
|
88.8
|
|
Reported amortisation
|
283.4
|
219.3
|
|
Adjusted EBITDA
|
305.9
|
190.2
|
|
Adjusted EBITDA margin
|
18.7%
|
13.8%
|
Earnings per share
|
|
2023
£m
|
2022
£m
|
|
Adjusted earnings per ordinary share
|
|
|
|
Loss available for equity holders
(£m)
|
(228.1)
|
(528.6)
|
|
Adjusting items (note 5)
|
|
|
|
Adjusting items before tax
(£m)
|
68.0
|
44.0
|
|
Tax on adjusting items
(£m)
|
-
|
-
|
|
Adjusted loss (£m)
|
(160.1)
|
(484.6)
|
|
Basic weighted average number of
ordinary shares (million)
|
748.2
|
424.7
|
|
Adjusted loss per ordinary share
(pence)
|
(21.4p)
|
(114.1p)
|
|
Adjusted diluted earnings per ordinary share
|
|
|
|
Adjusted loss (£m)
|
(160.1)
|
(484.6)
|
|
Diluted weighted average number of
ordinary shares (million)
|
748.2
|
424.7
|
|
Adjusted diluted loss per ordinary
share (pence)
|
(21.4p)
|
(114.1p)
|
Net debt
|
|
2023
£m
|
2022
£m
|
|
Opening cash and cash equivalents
|
583.3
|
418.9
|
|
Cash inflow from operating
activities
|
145.9
|
127.1
|
|
Cash outflow from investing
activities
|
(383.4)
|
(284.7)
|
|
Cash inflow from financing
activities
|
59.7
|
315.0
|
|
Effect of exchange rates on cash
and cash equivalents
|
(13.1)
|
7.0
|
|
Cash and cash equivalents at 31 December
|
392.4
|
583.3
|
|
Cash held not available for
short-term use
|
-
|
0.3
|
|
Borrowings
|
(1,069.7)
|
(1,211.1)
|
|
Lease liabilities
|
(97.3)
|
(99.8)
|
|
Inventory repurchase
arrangement
|
(39.7)
|
(38.2)
|
|
Net debt
|
(814.3)
|
(765.5)
|
|
|
|
|
|
Adjusted EBITDA
|
305.9
|
190.2
|
|
Adjusted leverage
|
2.7x
|
4.0x
|
Free cash flow
|
|
2023
£m
|
2022
£m
|
|
Net cash inflow from operating
activities
|
145.9
|
127.1
|
|
Cash used in investing activities
(excluding interest received)
|
(396.9)
|
(286.9)
|
|
Interest paid less interest
received
|
(109.0)
|
(139.0)
|
|
Free cash flow
|
(360.0)
|
(298.8)
|