The latest James Bond film, No Time to Die, featured no fewer than four Aston Martin models. The final outing of Daniel Craig as 007 was a chance for the British sports car-maker to feature its latest offering, a Valhalla hypercar — although Bond doesn’t actually get behind the wheel.
The Valhalla, a £700,000 plug-in electric hybrid supercar, is set to launch in 2023 and Aston Martin is believed to be planning to build about 1,000.
But the company has more immediate concerns. Last week, it warned that profits would be £15 million below expectations because of sluggish deliveries of its flagship hypercar, the £2.5 million Valkyrie.
Founded in 1913 by Lionel Martin and Robert Bamford, Aston Martin has gone bust seven times. It was saved from an eighth bankruptcy in 2020 when the Canadian Formula One tycoon Lawrence Stroll bailed out the company and took control. He later said that a fundraising, borrowing at a rate of 10.5 per cent on more than $1 billion of bonds, meant Aston Martin was “funded for ever”.
Stroll invested with a consortium of backers including JCB owner Lord Bamford, taking 25 per cent of the company’s shares as part of a £536 million cash call. He later followed up with another fundraising, which handed 20 per cent of the company to Mercedes.
This financing has left Aston Martin facing sharp quarterly bills. In the three months to the end of September it paid £133 million, which helped push losses in the third quarter to £97.9 million, from £80.5 million in the same period a year earlier.
In last week’s trading statement, the company promised that the production problems behind the Valkyrie delay would mean the 6.5-litre car would be delivered this year, rather than cancelled.
While there were some more upbeat notes — it said the number of cars delivered to dealers around the world in 2021 rose by 82 per cent to 6,182 — the profit warning will do little to inspire confidence in an Aston Martin turnaround. Analysts called the update reassuring, suggesting the shares had been pricing a profit miss since October.
The shares have sunk by 87 per cent since the company’s 2018 stock market listing, closing on Friday at £14.46 and valuing Aston Martin at £1.7 billion. However, the cynic may suggest that the trading statement looked distinctly like attempts to offer reassurance ahead of another potential fundraising.
Aston Martin is losing cash and has high finance costs to consider. Sell.
