H1 2020 RESULTS
S I X M O N T H S E N D E D 3 0 J U N E 2 0 2 0
A G E N D A
- H1 2020 HIGHLIGHTS
- FINANCIAL REVIEW
- STRATEGIC PLAN
- Q&A
APPENDIX
2
E X E C U T I V E C H A I R M A N
LAWRENCE STROLL
H1 2020: STRONG INITIAL PROGRESS ON STRATEGIC PLAN
Rebalancing sports car exclusivity with 869 units destocked across the dealer network
Appointment of new Executive leadership team
Decisive action taken on costs to align organisation to lower wholesales
DBX deliveries started in July and media launch underway
Secured additional liquidity successfully raising £688m of new equity
4
C H I E F F I N A N C I A L O F F I C E R
KENNETH GREGOR
STRATEGIC RESET WHILST NAVIGATING COVID-19
Strategic reset impacting financial results
- Lower wholesales as reduce dealer stock
- High retail and customer financing support
Covid-19 impacts
- Customer (retail) & dealer (wholesale) demand reduced
- Manufacturing operations temporarily suspended
Continued capital investment to support new models
- Particularly DBX in H1; Capex £162m
Working capital outflow
- Payables £110m and inventory £30m
Non- cash accounting adjustment relating to the timing of variable marketing expense accruals for the US region
- Restated 2019 balance sheet and income statement
- Impact is a reduction to EBIT of £15.3m in 2019
6
H1 2020 FINANCIAL RESULTS
Total Retails 1
(Units) | ||
1,770 | ||
H1 2020 | ||
H1 2019 | 2,996 | |
Total Wholesales2
(Units)
H1 2020 | 895 | |
H1 2019 | 2,442 | |
Revenues 3
(£m) | ||
H1 2020 | 146 | |
H1 2019 | 406 | |
3 | |
Adjusted EBITDA | |
(£m) | |
H1 2020 | (89) |
H1 2019 | 21 |
Capital Expenditure
(£m)
H1 2020 | 162 | ||||
H1 2019 | 162 | ||||
Free Cash Flow | 4 | ||||
(£m) | |||||
H1 2020 | (371) | ||||
H1 2019 | (161) | ||||
Note: Certain financial data within this presentation has been rounded; See Appendix for more detail on APMs; (1) Total retails are
7 dealer sales to customers (some specials are direct to customer); (2) Total wholesales are company sales to dealers (some specials are direct to customers); (3) 2019 has been restated; (4) Operating cash flows less cash interest and capex
TOTAL WHOLESALES 895 (63%); TOTAL RETAILS 1,770 (41%)
Total wholesales by model
(Units)
1
Other: 15
(82%)
GT: 596
(59%)
Total wholesales by geography
Specials: 1 | (78%) | |||
(97%) | (60%) | (51%) | (61%) | |
China (74%) |
Sport: 283
(67%)
700 | 565 | 490 | 687 | |
280 | 275 | |||
191 | 149 | |||
Americas | UK | EMEA ex.UK | APAC | ||||
H1 2019 | H1 2020 | Wholesale change by region | |||||
Wholesale ASP (£k) | Retails | |||||||||
2,996 | ||||||||||
145 | 124 | |||||||||
1,770 | ||||||||||
2,907 | ||||||||||
139 | 121 | 1,763 | ||||||||
2 | ||||||||||
H1 2019 | H1 2020 | H1 2019 | H1 2020 | |||||||
Core | Total | Core | Total | |||||||
8 | Note: Certain financial data within this presentation has been rounded; See Appendix for more detail on APMs; wholesales are company |
sales to dealers (1) Other consists of prior generation models including 10 Rapide AMRs; GT is DB11 + DBS Superleggera; Sport is Vantage; | |
(2) 2019 has been restated |
Total retails: (41%)
Dealer Inventory: 869-unit reduction
REVENUE DECLINE REFLECTS STRATEGIC ACTIONS AND COVID-19 DISRUPTIONS
(£m) | |||||
1 | |||||
406 | |||||
2 | |||||
3 | |||||
(242) | (9) | (2) | (7) | ||
146 | |||||
4 | |||||
H1 20191 | Sale of vehicles | Sale of parts | Servicing of | Brand and motorsport | H1 2020 |
vehicles |
Sale of vehicles
Lower wholesales primarily due to strategic destock and Covid-19 impact, fewer Specials and decreased ASP
Sale of parts
Decreased due to Covid-19 restricting dealer operations
Servicing of vehicles
Limited capacity for restorations, while team focused on production of the DB5 Goldfinger Continuation specials
Brand and motorsport
Reduced race car sales year-on-year due to deferral of races
9 | Note: Certain financial data within this presentation has been rounded; See Appendix for more detail on APMs; (1) 2019 has been |
restated |
STRATEGIC REPOSITIONING REDUCES PROFITS DESPITE TIGHT OPERATIONAL COST CONTROL
(£m) | PBT Analysis | ||||||||||||||||||||||||||||
5.4% | n.m. | £m | H1 2020 | H1 2019 | |||||||||||||||||||||||||
19 | Restated | ||||||||||||||||||||||||||||
41 | |||||||||||||||||||||||||||||
21 | Adjusted EBITDA | (89) | 21 | ||||||||||||||||||||||||||
25 | D&A | (57) | (57) | ||||||||||||||||||||||||||
(89) | Adjusted EBIT | (146) | (36) | ||||||||||||||||||||||||||
(17) | |||||||||||||||||||||||||||||
(147) | 11 | (2) | |||||||||||||||||||||||||||
1 | |||||||||||||||||||||||||||||
Net financing expense | (68) | (35) |
3 | Other expense2 | 3 | Wholesales | Mix & Price | Other gross | Net operating | FX | H1 2020 adj |
H1 2019 adj | H1 2019 adj | |||||||
EBITDA | EBITDA (pre | margin | expenses | EBITDA | ||||
other income) |
Margin
Adjusted PBT | (214) | (71) |
EBITDA decline driven by strategic plan to lower wholesales to
1 reset to luxury positioning, exacerbated by Covid-19
Continued retail and customer financing support to drive retails, relative proportion of retails to wholesales (c.2x) and lower Specials weighed on ASP
Net operating expenses
3
D&A broadly unchanged year on year
Same core models as prior year and only one Special
Net financing expense of £68m
2 Re-phased marketing spend and c. £10m of furlough credits more than offset incremental St Athan costs (c. £3m)
4 Increased interest payments given full six months of $190m notes and $150m of notes issued in H2 2019 (£44m) and £20m adverse FX
10 Note: Certain financial data within this presentation has been rounded; See Appendix for more detail on APMs; (1) excluded adjusting item of £7m; (2) Intellectual Property provision realised in H1 2019; (3) 2019 is restated
H1 WEIGHTING OF INVESTMENT PRIOR TO DBX DELIVERIES FROM JULY; FREE CASH OUTFLOW OF £371m1
(£m)
142 | (93) |
(7) |
(228)
PBT 1 | Add back D&A/other non- | Tax Paid | Cash loss after tax |
cash |
1 PBT | 2 Add backs |
Loss primarily due to | Key items include: |
decline in revenue | - D&A £57m |
- £(260)m | - Net financing expense £68m |
(30)
(162)
Net Interest | CAPEX |
3 Net Interest
Cash interest items:
- £2m of interest received
- £(31)m of interest paid
(371)
(86)
Working Capital | Free Cash Flow2 |
4 Working Capital
Payables £(110)m
Inventory £(30)m
Receivables £51m
Deposits £3m
11 | Note: Certain financial data within this presentation has been rounded; See Appendix for more detail on APMs; (1) PBT after |
adjusting items (£14m) (2) Operating cash flows less cash interest and capex |
SECURED ADDITIONAL LIQUIDITY, SUCCESSFULLY RAISED GROSS PROCEEDS OF C. £688m1
(£m)
628 | 47 | ||||||||||||||
(6) | 359 | (9) | (20) | (2) | |||||||||||
108 | 988 | ||||||||||||||
(252) | |||||||||||||||
(371) | 751 | ||||||||||||||
2 | Net debt 3 | ||||||||||||||
Cash balance | Free Cash Flow | Cash inflow from | Effect of ex. rates on | Cash balance | SSN FV | Banks Loans & | Inventory | Lease Liabilities Net Change in | Net debt | ||||||
31-Dec-19 | financing activities | cash and cash | 30-Jun-20 | 31-Dec-19 | movement | Overdrafts | Financing | Cash | 30-Jun-20 | ||||||
equivalents |
Financing
Net Debt / Cash
1
Placing and equity raise
£171m placing in March and £365m equity raise in April
£536m
5 £688m1 gross raise contributed to total £252m cash inflow
Cash inflow from financing £628m includes £20m outflow from reduced inventory financing
2 | Non-pre-emptive equity raise |
26 June - equity raise | |
3 | Delayed draw notes |
DDN senior secured notes due 2022 at 12% coupon in July (Q3) | |
Coronavirus Large Business Interruption Loan
4 Scheme
Received approval for a CLBILS loan completed 23 July 2020
£152m
4
$68m
£20m
6 Cash at 30 June £359m up from £108m at December 2019
Proforma net cash of £430m5including DDNs ($68m), CLBILS (£20m) and £5m retail element of June equity raise
7 Net debt reduced to £751m at 30 June
Gross debt at 30 June £1,121m; Proforma gross debt of £1,196m
Note: Certain financial data within this presentation has been rounded; see Appendix for more detail on APMs; (1) £147m of 26 June Placing
12 received in H1, remaining £5m in H2; (2) excludes finance interest; (3) Includes lease liabilities; (4) Post H1 raised; (5) Net of c. £10m remaining in fees
2020 RESET TO BUILD SUSTAINABLE BUSINESS
Pace of emergence from Covid-19 and consumer recovery varies by geography
- Destock of global dealer network likely to extend well into 2021
- >90% of the global dealer network now open
- Early signs from China positive
2020 wholesales currently expected to be broadly balanced between sports cars and DBX
- Specials in H2 (DB5 Goldfinger Continuations and DBS GT Zagatos)
- Aston Martin Valkyrie deliveries start 2021
DBX deliveries commenced St Athan ramping build rate
- Positive contribution to H2
Gaydon to resume manufacturing at end of August
- Later than originally planned as balance supply to demand
Rigorous cost control and investment discipline
- C. £28m annualised savings in 2021; low single digit £m in H2 2020
- FY 2020 capex of c. £260m to deliver new products
13 Note: Certain financial data within this presentation has been rounded; see Appendix for more detail on APMs
E X E C U T I V E C H A I R M A N
LAWRENCE STROLL
STRONG BRAND HERITAGE
<100,000
CARS BUILT IN
OUR HISTORY
107
YEARS OLD (EST. 1913)
$22.5m
1956 ASTON MARTIN DBR1
15
REALISING THE OPPORTUNUTY FOR ASTON MARTIN LAGONDA
Unique luxury brand defined by unparalleled design and beauty
Focus on desirability and scarcity value to build orderbook
- Sport/GT (Vantage, DB11 & DBS Superleggera)
- SUV (DBX)
- Mid-engine(Valhalla & Vanquish)
F1TM team further strengthening brand equity
Operational efficiencies and cost control amplifying financial impact of strategy
World class leadership combining the best of automotive and luxury industries
16
SPORTS/GT CARS
SPORT | GT | SUPER GT |
VANTAGE ROADSTER | DB11 VOLANTE | DBS SUPERLEGGERA VOLANTE |
17
SUV - DBX
18
MID ENGINE - ASTON MARTIN VALKYRIE
19
MID ENGINE - VALHALLA
20
MID ENGINE - VANQUISH
21
2021 FORMULA ONETM TEAM
SIGNIFICANT MARKETING OPPORTUNITY
22 RACES
OPPORTUNITY TO ENGAGE
CUSTOMER BASE
20 DEALERS
IN RACE MARKETS
GLOBAL MARKETING
PLATFORM TO LAUNCH
MID-ENGINE CARS
STRENGTHEN BRAND
>80% OF LUXURY/PREMIUM CAR BUYERS ARE INTERESTED IN F1TM
22
SIGNIFICANT OPPORTUNITY AHEAD
STRONG PROGRESS EXECUTING PLAN
ALIGNING COSTS TO DRIVE PROFITABILITY
EXPANDING PRODUCT PORTFOLIO
Rebalancing sports cars; destocking 869-units
New Executive leadership team; combining luxury and automotive
Headcount reduction aligned to lower sports car volumes
Focus on appropriate capital investment
DBX has started deliveries
Mid-engine development started
23
Q & A
Income Statement, Cash Flow and Net Debt
£m | H1 2020 | H1 2019(1) |
Revenue | 146.0 | 406.0 |
Cost of sales | (148.8) | (259.2) |
Gross profit(2) | (2.8) | 146.8 |
Gross margin | n.m. | 36.2% |
Operating expenses(2) | (142.7) | (164.2) |
of which depreciation & amortisation | 56.5 | 57.2 |
Other Expense | - | (19.0) |
Adj. operating loss | (145.5) | (36.4) |
Adj. operating loss margin | n.m. | n.m. |
Adjusting operating items | (13.8) | (2.5) |
Operating loss | (159.3) | (38.9) |
Net financing expense | (68.1) | (41.1) |
of which adjusting financing items | - | (6.6) |
Loss before tax | (227.4) | (80.0) |
Taxation | 27.6 | 17.2 |
Reported net income | (199.8) | (62.8) |
Adj. EBITDA | (89.0) | 20.8 |
Adj. EBITDA margin | n.m. | 5.1% |
Adj. loss before tax | (213.6) | (70.9) |
Diluted EPS (pence) | (16.7) | (7.3) |
Adjusted diluted EPS (pence) | (15.8) | (6.4) |
£m | H1 2020 | H1 2019(1) |
Net cash generated from operating activities | (179.4) | 20.8 |
Net cash used in investing activities | (159.9) | (159.0) |
Net cash inflow from financing activities | 597.3 | 121.0 |
Effect of exchange rates on cash and cash equivalents | (6.5) | (0.5) |
Cash not available for short-term use(3) | 10.7 | - |
Net cash outflow | 251.5 | (17.7) |
Cash balance | 359.4 | 126.9 |
Borrowings | 877.0 | 734.9 |
Unsecured Loans | - | 0.9 |
Inventory repurchase arrangement | 19.5 | - |
IFRS 16 Lease Liabilities | 110.0 | 111.6 |
Bank Loans and Overdrafts | 114.6 | 123.1 |
Net debt | 751.0 | 843.6 |
Adj. Leverage(4) | n.m. | 5.3x |
25 | Note: See Appendix for more detail on APMs; (1) 2019 was restated; (2) Excludes adjusting items; (3) Cash not available for use, but included in leverage calculation |
APM reconciliation and Adjusting items
Income Statement reconciliation
£m | H1 2020 | H1 2019(1) |
(Loss) for the year before tax | (227.4) | (80.0) |
Adjusting operating expenses | 13.8 | 2.5 |
Adjusting finance expenses | - | 6.6 |
Adjusted EBT | (213.6) | (70.9) |
Adjusted finance (income) | (1.6) | (3.2) |
Adjusted finance expense | 69.7 | 37.7 |
Adjusted EBIT | (145.5) | (36.4) |
Reported depreciation | 22.7 | 24.7 |
Reported amortisation | 33.8 | 32.5 |
Adjusted EBITDA | (89.0) | 20.8 |
H1 2020 Adjusting items
£m | Income Statement |
Staff incentives | 3.3 |
Settlement arrangements & Incentive Payments | (2.7) |
Impairment | (2.0) |
Restructuring Costs | (12.4) |
Adjusting operating items | (13.8) |
Tax on adjusting items | 3.6 |
Total adjusting items | (10.2) |
26 | Note: See Appendix for more detail on APMs; (1) 2019 has been restated |
EPS reconciliation
H1 2020 | H1 2019(3) | ||
Adjusted Earnings Per Ordinary Share | |||
(200.3) | (63.8) | ||
(Loss) available for equity holders (£m) | |||
Adjusting Items | |||
13.8 | 9.1 | ||
Adjusting items before tax (£m) | |||
(3.6) | (1.4) | ||
Tax on adjusting items (£m) | |||
(190.1) | (56.1) | ||
Adjusted Earnings (£m) | |||
1,203.0 | 870.4 | ||
Basic weighted average number of ordinary share (millions) | |||
(15.8p) | (6.4p) | ||
Adjusted earning per ordinary shares (pence) | |||
Adjusted Diluted Earnings Per Ordinary Share | |||
(190.1) | (86.5) | ||
Adjusted Earnings (£m) | |||
1,203.0 | 870.4 | ||
Diluted weighted average number of ordinary shares (million) | |||
(15.8p) | (6.4p) | ||
Adjusted diluted earnings per ordinary share (pence) |
27 | Note: See Appendix for more detail on APMs; (1) Excludes adjusting items; (2) Cash not available for use, but included in leverage calculation; (3) 2019 has been restated |
H1 Results
£m | Q1-20 | Q1-19 | Q2-20 | Q2-19 | H1-20 | H1-19 |
Total wholesale volumes (#)(1) | 578 | 1,057 | 317 | 1,385 | 895 | 2,442 |
Revenue | 88.8 | 201.5 | 57.2 | 204.5 | 146.0 | 406.0 |
Adj. EBITDA | (38.1) | 34.0 | (50.9) | (13.2) | (89.0) | 20.8 |
Adj. operating loss | (67.0) | 3.5 | (78.5) | (39.9) | (145.5) | (36.4) |
Operating loss | (67.9) | 2.5 | (91.4) | (41.4) | (159.3) | (38.9) |
Loss before tax | (110.1) | (11.6) | (117.3) | (68.4) | (227.4) | (80.0) |
28
Note: See Appendix for more detail on APMs; (1) Includes Specials (2) 2019 has been restated
Restatement Summary
£m | Q1-19 | Q2-19 | Q3-19 | Q4-19 | Q1-20 |
Additional accrual (£m) | 8.1 | 15.0 | 21.8 | 29.1 | 20.3 |
Impact on EBIT (£m) | 5.7 | (7.0) | (6.8) | (7.2) | 8.8 |
ASP Total/core (£k)
165/154 | 129/128 | 147/126 | 158/127 | 113/113 |
As previously reported ASP total/core (£k) | 160/149 | 134/134 | 151/130 | 163/132 | 98/98 |
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Note: See Appendix for more detail on APMs; (1) Includes Specials (2) 2019 has been restated
Alternative Performance Measures
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.
- Adjusted EBT is the loss before tax and adjusting items
- Adjusted operating loss is loss from operating activities before adjusting items
- Adjusted EBITDA removes depreciation, loss/(profit) on sale of fixed assets and amortisation from adjusted EBIT
- 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, cash held not available for short-term use (the definition of this APM has been updated since 31 December 2019)
- Adjusted leverage is represented by the ratio of Net Debt, to the last 12 months adjusted EBITDA (the definition of this APM has been updated since 31 December 2019)
- Free cashflow is represented by net cash (outflow)/inflow from operating activities plus the net cash used in investing activities plus interest paid in the period. Further details and definitions of adjusting items are contained in note 5 of the Interim Financial Statements.
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Disclaimer
This presentation has been prepared by Aston Martin Lagonda Global Holdings plc ("AML") solely for use at the H1 results analyst and investor meetings being held on Wednesday, 29 July 2020 in connection with a discussion of its H1 2020 results. For purposes of this notice, this "presentation" shall include these slides and any question-and-answer session that follows oral briefings by AML's executives. This presentation is for informational purposes only does not constitute an offer to sell or the solicitation of an offer to buy AML securities. Furthermore, this presentation does not constitute a recommendation to sell or buy AML securities.
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 presentation. This presentation contains certain forward-looking statements, which are based on current assumptions and estimates by the management of AML. 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. AML provides no guarantee that future development and future results actually achieved will correspond to the forward-looking statements included here, and accepts no liability if they should fail to do so. We undertake no obligation to update these forward-looking statements, which speak only as at the date of this presentation, 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 presentation. This presentation is confidential and is being delivered to selected recipients only. It may not be reproduced (in whole or in part), distributed or transmitted to any other person. By attending the meeting at which this presentation is being given, you will be deemed to have represented, warranted and undertaken that you have read and agree to comply with the contents of this notice.
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Aston Martin Lagonda Investor Relations Team
investor.relations@astonmartin.com
www.astonmartinlagonda.com
Charlotte Cowley - Director of Investor Relations
charlotte.cowley@astonmartin.com
Tel: +44 (0)20 7076 5426
Brandon Henderson - Senior Manager, Investor Relations
brandon.henderson@astonmartin.com
Tel: +44 (0)20 7076 5406
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Aston Martin Lagonda Global Holdings plc published this content on 29 July 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 30 July 2020 08:45:30 UTC