Aston Martin losses soar to £466m
Luxury carmaker Aston Martin (AML.L) saw its losses almost quadruple to £466m ($659m) last year as sales sunk.
Aston Martin on Thursday reported a pre-tax loss of £466m for 2020, down from a loss of £119.6.m in 2019. It came as retail sales of its high-end cars fell by 32% and wholesale revenues slumped 42%.
Analysts said the decline was due to the company's actions to reduce the stock of cars held by dealers in showrooms, which slowed sales.
Management emphasised progress the company has made on its turnaround plan, which has been dubbed 'Project Horizon'.
"2020 has been a transformative year for Aston Martin," chairman Lawrence Stroll said. "Since I became executive chairman in April, we have made significant progress to position the Company for success to capture the huge and exciting opportunity ahead of us."
Canadian billionaire Stroll led a rescue of struggling Aston Martin last year, injecting cash and taking control of the business.
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"I am extremely pleased with the progress to date despite operating in these most challenging of times," he said.
"I, and my co-investors, are fully committed to delivering this plan and are confident in the future success of Aston Martin as we transform the Company to be one of the greatest luxury car brands in the world."
James Bond's carmaker reiterated its target of hitting £2bn in sales by 2025 and said recent trading had been in-line with forecasts.
"Increasing the number of SUV sales is mission critical to the turnaround of the brand," said Harry Barnick, a senior analyst at Third Bridge.
"Q3 was uninspiring with less than 400 units, Q4 volumes shot up to 1,171 units, which will bring comfort to investors. Aston Martin now has to sustain this quarterly figure through 2021 if it is to avoid falling behind by its competitors."
Aston Martin signed a technology agreement with Mercedes-Benz last October. Aston Martin chief executive Tobias Moers said this deal "underpinned" future product plans.
Barnick said this deal was a "a vital opportunity to grow its electric vehicle capabilities with limited investment."
"The rumour mill is already in overdrive with speculation that this could lead to an outright acquisition of AML," he said.
Shares in Aston Martin jumped 10% on the update.
