The luxury carmaker blamed falling sales in Britain and Europe, as well as global “macroeconomic uncertainty”, for the poor performance, which sent its shares to a new low.
They closed at 498p, down 12 per cent and little more than a quarter of their £19 float price last October, continuing a woeful performance that has marked one of the worst initial public offerings of recent times. About 1,000 employees of the company that bought shares in the listing are among those nursing heavy losses.
Aston Martin sought to play down speculation that it could be forced to tap shareholders for more cash, suggesting that it would turn to debt markets if needed.
Max Warburton, an analyst at Bernstein, said that the company was “on a financial knife-edge” with “very, very little room for error or further external pressures”. He suggested that it consider suspending executive pay.
Aston Martin is one of the best-known names in British car manufacturing, thanks in no small part to its cars featuring in the James Bond film franchise. It has gone bust seven times in its 106-year history.
Andy Palmer, 56, chief executive, has been seeking to turn around its fortunes with plans to expand its range, including its first sports utility vehicle, the DBX, (pictured above) due to be launched next year.
However, the company has been dogged by doubts over its growth plans since its listing and last week it stunned the stock market by warning that it expected to sell between 6,300 and 6,500 cars to dealers this year, compared with the 6,441 it delivered last year and the 7,200 to 7,400 it had forecast when it was floated. It also warned that profit margins would fall from a forecast 13 per cent to 8 per cent.
Yesterday it reported a £79 million pre-tax loss for the first six months, down from £21 million profit in the same period a year earlier, as revenues fell by 4 per cent to £407 million.
“We are disappointed that our projections for wholesales have fallen short of our original targets, impacted by weakness in two of our key markets as well as continued macroeconomic uncertainty,” Mr Palmer said.
Mr Warburton said that management needed to “hope and pray the DBX can launch bang on time, and save the situation” and in the meantime the company should aggressively cut back costs, including potentially “suspending the top guys’ compensation for a period”.
He said the results showed that Aston Martin had burnt through cash more quickly than expected and that the position was “not comfortable”. Management appeared to be “ruling out an equity-raise”, but raising debt was likely to be announced soon and would be expensive, but was “somewhere between prudent and essential”.
Mark Wilson, 45, chief financial officer, said: “If we require additional financing from sources with which we are familiar and, in particular, in the debt markets to maintain that capacity, then, that’s what we’ll go out and do.” He added that Aston Martin had more cash than a year ago.
