Aston Martin (LON: AML) shares are down 12% on the publication of the results. The financial outcomes are better than last year - not difficult - but perhaps not quite up to expectations. There’s a forecast of fewer DB12s to be sold than previously thought. But there’s a rather worrying indication that there might be yet another rights issue at some point. This depends more than a little on what we think they mean.
The results: “Continued strong demand across existing and new product lines; the recently launched DB12 is driving reappraisal of Aston Martin amongst new audiences, with 55% of its initial customers new to the Aston Martin brand and with order book now extending to Q2 2023. DBX orders also extending into 2024, as it continues to establish itself as the benchmark in the ultra-luxury SUV segment with over 25% market share in key markets. The DBX707 now represents c.70% of SUV sales in 2023 supporting the positive gross margin evolution. Wholesale volumes increased by 8% year-on-year to 4,398 (YTD 2022: 4,060) driven by strong demand across the portfolio. Q3 2023 volumes reflect the ongoing transition to our next generation sports cars, which started with the initial deliveries of the DB12. The DB12 production ramp up was temporarily affected as supplier readiness and integration of the new EE platform that supports the fully redeveloped infotainment system was delayed. These issues are now resolved but did impact Q3 volume and our FY production capacity” Nothing particularly stand out there.
The FT runs with the production delays leading to the share price fall. It is only 300 units off the full year figures though.
Aston Martin share price from Google Finance
Our worry though is in this phrase: “beyond that, we intend to undertake a fulsome refinancing exercise during the first half of 2024” and, well, what does that mean? A refinancing of the debt only? Or are they going to issue more shares to provide an enlarged capital base?
The point being that they’ve issued a lot of stock already. As we’ve pointed out about Aston Martin and AML shares before.
It wouldn’t surprise us to find that some of this price fall is nervousness about what that phrase really does mean.
