Aston Martin Lagonda Global (AML) Q2 2024 earnings summary

Executive summary

• Successfully delivered new models in H1 2024, with strong acclaim and customer demand; DB12 sold out into 2025 and two more launches on track for H2 2024.

• Product portfolio transformation and Specials drove performance, supporting volume growth and sustainable positive free cash flow expected in H2 2024.

• Leadership transition planned, with Adrian Hallmark joining as CEO in September 2024, ensuring continuity and strategic focus.

• Successful refinancing completed, securing improved terms and increased liquidity to support long-term growth.

Financial highlights

• H1 2024 revenue decreased 11% year-over-year to £603m, reflecting planned portfolio transition and FX headwinds, partially offset by strong Specials volumes.

• Adjusted EBITDA fell 23% to £62m, with margin at 10.3%, ahead of guidance due to Specials phasing.

• Gross margin improved 370 bps to 38.6% (Q2: 40%), approaching the 40% full-year target.

• Free cash outflow was £313m in H1, expected to turn positive in H2 2024.

• Net debt increased to £1,194m, with net leverage ratio at 4.2x.

Outlook and guidance

• 2024 guidance and medium-term targets reiterated: high single-digit wholesale volume growth, gross margin circa 40%, and EBITDA margin expansion into the low 20s.

• Q3 2024 volumes expected to improve sequentially, with Q4 as the largest quarter for both volumes and financial performance.

• Positive free cash flow generation targeted for H2 2024 and full-year 2025, with leverage ratio goal of 1.5x in the medium term and below 1.0x longer term.