Aston Martin: ‘Ultra luxury’ strategy pays off with revenues up 26 per cent and GT/Sports range ‘sold out’

Aston Martin has reported a full-year loss of £118m, growing from a loss of £74.3m year-on-year but ahead of consensus expectations for £135m.

The luxury carmaker said capital expenditure was expected to increase year-on-year but that it would deliver significant growth in profitability this year and positive free cash flow in the second half.

Aston Martin also said it was track to meet its target for around £2bn revenue – a growth of 26 per cent – and £500m of adjusted EBITDA by 2024/25.

Aston Martin said its full year 2022 results were in line with expectations and were driven by a record total average selling price of more than £200,000 per car.

The car maker said its “ultra luxury” strategy was working and reported demand across its portfolio, with 80 per cent of its current range GT/Sports sold out for 2023 ahead of upcoming launches.

Victoria Scholar, head of investment at interactive investor said, “Aston Martin has been struggling with cost inflation, delivery delays and supply chain bottlenecks post pandemic.

“However, losses were more moderate than analysts were anticipating, and it has issued a rosy outlook for this year and next. It is focusing on quality over quantity, with volumes expected to fall. Instead it is aiming to deliver high quality specials such as the sold-out Valkyrie Spider and ultra-luxury DBR22 in the second half of 2023. 

Aston Martin share price

Scholar added: “Although Aston Martin had a tough 2022, the stock has enjoyed a strong start to this year, rallying by more than 40% since the beginning of January including a double-digit percentage surge today. Aston Martin Lagonda is in fact the best performing stock on the FTSE 250 over a 3-month period. Analysts appear to be increasingly optimistic towards the stock with a series of price target upgrades from JPMorgan, Barclays, and Citigroup this year.”

Chris Beauchamp, chief market Analyst at IG Group, said Aston Martin’s results showed ” signs of improvement”.

“It never pays to be too enthusiastic about Aston Martin’s prospects, but perhaps there are signs of improvement in this morning’s numbers. Debt is down and sales rose 26 per cent, but losses widened on all three main metrics. Higher margins for the year ahead will help remedy this, and if the global economy skirts a recession perhaps some of its high-end customers will feel more optimistic about putting down deposits on cars. The shares have doubled since October, so some caution in early trading would not be surprising.”