Aston Martin Lagonda Global Holdings Plc has announced plans to raise additional capital after issuing its second profit warning in two months. The luxury carmaker, headquartered in Warwickshire, has faced persistent production and financial difficulties, exacerbated by supply chain disruptions and a weakening macroeconomic environment in key markets like China.
The company revealed that production targets for 2024 have been reduced to 6,000 vehicles, down from a previous estimate of 7,000. This adjustment follows setbacks caused by supplier insolvencies, including key German firms that manufacture seats and dashboards, as well as slower-than-expected sales of its DBX SUV in China. Aston Martin’s new CEO, Adrian Hallmark, emphasized the need for decisive action to stabilize the company’s operations, acknowledging that the initial forecasts were overly optimistic given the current challenges.
The profit warning has led to a sharp decline in the company’s stock, which plunged by 20%, marking a two-year low. Financial analysts have expressed concern over Aston Martin’s ability to meet its long-term goals, though the company remains committed to achieving its 2025 targets of £2 billion in revenue and £500 million in underlying operating profit. Executive Chairman Lawrence Stroll, who played a pivotal role in rescuing the company in 2020, reiterated confidence in the turnaround strategy, attributing current setbacks to short-term disruptions.
Amid these challenges, Goldman Sachs forecasts a 5% revenue drop for Aston Martin in 2024, projecting £1.54 billion in revenue and a nearly 2% decline in EBITDA to £269 million. The company is also expected to see its net losses rise by 25%, approaching £300 million. However, projections for 2025 remain optimistic, with revenues anticipated to exceed £2 billion and a modest pre-tax profit of £20 million.
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