AML - Stock Market Listing

[Jon39]

Media extract.
...................................................................................................................................................................
Reportedly, the parent company of the Aston Martin F1 team – Aston Martin Lagonda – has taken up an option to acquire a near-£20million stake in the side.

“Formula 1 has helped transform the nature of the business and give us the performance credentials and credibility by putting it into our road cars,” executive chairman Lawrence Stroll said during an Aston Martin strategy event at their Gaydon HQ, as reported by The Times.

“Not only has Formula 1 given us the 2.3 billion viewers that see a beautiful British racing green Aston Martin 24 weekends this season; it’s also brought us a much younger customer to Aston Martin.”
...................................................................................................................................................................


AML (Chairman Lawrence Stroll) buys a £20 million shareholding in a privately owned racing team (Owner Lawrence Stroll).

Lawrence Stroll explains, that the AML business has been transformed (don't look at the financial figures) helped by F1 on the telly.

[ 2.3 billion must be calculated by counting the same people 24 times, unless each person only watches one race each year?
How dim does he think we all are? ]

Edited by Jon39 on Tuesday 16th April 07:49

[Jon39]

12TS said:

Share price now ~ 150p, still a way to go to its 72p low but it's been sliding for the last 6 months in a climbing market.

Short-term, a share price moves up and down driven by demand.
Long-term, simple fundamentals require a steady increase in profitability to raise a share price.
If Aston Martin can achieve regular pre-tax profits (ignore EBITDA), then the share price will accelerate.
A surprise takeover bid would of course do the same. Aston Martin has a very valuable brand.

If you want a laugh, the gamblers and dreamers on the LSE Aston Martin share chat forum can entertain.
One recently cited the profits made, when the share price went fronm 65p to £15.
That happened when a capitalisation change, replaced every 20 shares with 1.
Any 'profit' following that was imaginary.


A selection of motor manufacturers below. Not an easy business.

Edited by Jon39 on Thursday 18th April 08:24

[Jon39]

Davil said:

He is a very clever man.

You will hate this but I was down at the F1 in Melbourne, the sound of the safety car was the final thing that made me buy another Aston while I was down there. Such a great sound. Now I have two. All of the things that Stroll has put into place will likely make me buy another over the next couple of years.

Strollism in action down under.

Now we need positive cash flow. LS first promised that for Q3 2023, then FY 2023, now sometime in 2024.
"It's not revenue or EBITDA that will make AML rich, it is spending habits and less debt." - [adapted from a quote by Charles A Jaffe.]

Edited by Jon39 on Friday 19th April 10:14

[Jon39]

Two very different men.

Mr Warren Buffett.
Worth $139 billion.
Has always refused to speak about the intrinsic value of his business.

Mr Lawrence Stroll.
https://archive.ph/Iytuq

[Jon39]

Forester1965 said:

It's now a 'lifestyle brand'. Oily bits don't really matter as they can buy them in to spec. Has to look amazing and have the right image. Not competing with Ferrari or Porsche. Competing with your next watch, outfit, property purchase or face lift.

The irony is the F1 team is probably worth more than the car company.

In the run-up to the AML stock market flotation, Andy Palmer proudly proclaimed that the Company was no longer a motor vehicle manufacturer, but had now become a luxury goods business and would be unaffected by economic downturns.
Think he might have kept quiet about the Gaydon antics in 2008/2009, the start of the global banking crisis. Cancelled orders, unsold stock and many redundancies.

The timing of that economic event was such a shame, just as Aston Martin was enjoying considerable success.
Packaging up loans to unemployed string vest wearing borrowers, sitting on the crumbling balconies of their dilapidated homes, was bound to end in tears.
Did Christian Dior, Givenchy, Hermes and Gucci continue setting uninterrupted sales records during that grim period ?

Edited by Jon39 on Friday 19th April 16:50

[Jon39]

Simpo Two said:

Jon39 said:

Mr Lawrence Stroll.
https://archive.ph/Iytuq

Maybe Stroll should take over 'The Apprentice' and Lord S can have a go at running AM...? Might takes some of the bullst out....

I cannot ever remember a public company chairman openly promoting the buying of their company shares before.
Saying they are undervalued, is clearly providing financial advice, tantamount to encouraging people to buy the shares.
The Stock Exchange does have strict rules, but whether officers have restrictions placed upon them, I don't know.

Edited by Jon39 on Friday 19th April 21:53

[Jon39]

SSO said:

I just did a piece on a few "nuggets" from AMLs 2023 Annual Report.

Thank you SSO.
An accurate article, as always.

It is probably unfortunate for LS, that some of us can remember his previous statements.

There are many people on the share chat forums, who appear to only take notice of LS's latest pronouncement, assume profitability is imminent and so believe the share price is about to zoom skywards. The 2:30 at Kempton Park, might be more fun for those gamblers.

Extract from a recent interview.
' the share price is still around half that of when Stroll took over, itself well down on Aston’s original listing. This irks him. “Our share price is hugely undervalued,” he said.'

Does the London Stock Exchange permit chairmen and directors, to make announcements about their Company shares being very cheap ?
I have never heard anything like that being said before, by any director of a quoted company. They are always very cautious about giving what could be construed as either inside information, or financial advice.
If nothing legally wrong, then to me, it is at least an unprofessional remark.

The most galling remark reportedly made by him, was feeling that he deserved a knighthood, for supposedly saving thousands of jobs and transforming the industry. AML only employ about 2,000, so barely in the thousands. Perhaps his personal transformation, included the whole West Midlands motor industry. The employee numbers were lower when Aston Martin set their all time production record, achieved at the time with only one factory.

[Jon39]

LTP said:

I wonder if anyone in Gaydon actually reads the SSO reports?

Perhaps a crafty secret read, but admitting to that, would probably result in instant dismissal.
I don't think employees reading criticism of the high priest, would be tolerated.

[Jon39]

SSO said:

In theory they shouldn't have an issue. The information in the reports comes from AMLs publicly published documents and the Chairman's public statements.

Yes, in theory.

With LS repeatedly making his public statements (several subsequently shown to be (you know), I don't know how friendly, fair, understanding and forgiving he might be with subordinates.
Have never had any dealings with the man, so only judging how he might react, by what he has been saying.

[Jon39]

Minglar said:

Q1 2024 results released earlier this morning. BRM.

https://www.londonstockexchange.com/news-article/A...

I have so far only read the initial part, but have spotted a contradiction;

'Our first quarter performance reflects this expected period of transition, as we ceased production and delivery of our outgoing core models ahead of the ramp up in production of the new Vantage, upgraded DBX707 and our upcoming V12 flagship sports car which we've confirmed today.'

The published figures show an increase in Sports/GT 650 (up 12%).
The overall total 945 (down 26%) has been pulled down by,
SUVs 250 (down 63%).

............................................................................................................

As well as the usual 'ultra-luxury' (5 times),
a new phrase has appeared 'ultra-exclusive' (2 times).
Perhaps there will be a whole collection of 'ultra-xxx', but I will leave that open for your suggestions. -

The live (online) presentation is due at 8:30am. Just need to register on the Aston Martin / Investors web page.

Edited by Jon39 on Wednesday 1st May 07:59

[Jon39]

silentbrown said:

I believe the new TVR Griffith is "ultra-exclusive"?

And that single car was so extremely ultra-exclusive, that the TVR employees (having no known record of even building any cars) had it assembled secretly by a firm who could do such things. The begining of a dream, by a bunch of dreamers, that gradually faded into silence.

[Jon39]

Minglar said:

Did anyone seriously expect strong numbers today? As many have commented here previously, why would anyone buy a car which is coming towards the end of its production run unless there is a very attractive incentive to do so. To my mind that means new Vantage, perhaps unsold stock DB11, and both DBX variants (three if you include the hybrid version sold in China). So that may explain the sharp drop in SUV numbers. The slight rise in Sports/GT is probably a result of DB12. It’s a shame the numbers are not broken down by specific model type rather than lumped together and recorded as one. So I think we have to take all of this in to context a little for this quarter. I have no idea where AML will be as a business this time next year, but as I’ve said before imho I think the current range of cars is good enough, and will continue to improve. Will there be a sufficient number of buyers across the globe in the current economic climate? Maybe, maybe not, I don’t know. But it will be interesting to see how the appetite shapes up when new new Vantage/Roadster, DB12/Volante, updated DBX707, and the new V12 models announced today, can all contribute to the numbers. Don’t get me wrong. I’m not defending LS. His pricing model means it is unlikely I will buy another new Aston Martin, as the cost to change now makes no economic sense at all, even if I can afford it. Many others on here probably feel the same and are happy with the cars they currently own. But as a relatively long term loyal customer I want the company to survive, although it will probably mean a takeover at some point. The financials are not sustainable unless there is yet another cash injection or RI. I have refrained from posting anything in the LSE forum as there really is no point. There is clearly vested interest in there from one particular poster to continually talk the SP down and see this company fail, for whatever reason. I guess it’s no coincidence that his/her/their number of posts has dramatically increased over the last few days, and of course today.
BRM.

Good points made today on this topic, by every poster.

We now have a few 'wait and sees', amongst which are;

Prospective buyers who knew about the expected model changes.
SUV sales significantly down.
Wonder how many might simply have delayed their purchases, or did some drift away and were lost to competitors instead of waiting?

As you state, the revised cars are all much more attractive now to an increased number of prospective customers, but will the much higher list prices and option prices be an off putting factor?

LS said a long time ago, that the debt is something that must be dealt with. On two occasions, the debt has been partly paid off early, but in the recent refinancing, the total has increased again.


Did you listen to the presentation this morning?
L.S. absent. I did not hear the start of the presentation, but perhaps a reason was given for him not being present.

There was a cracking question from one analyst.
When the new CEO begins his role, will Lawrence Stroll relinquish his Executive Chairman position, so that the CEO can operate in an unhindered manner?
Doug Lafferty managed not to laugh, but said that is something he cannot answer, but he looks forward to working with the new CEO.

[Jon39]

DMZ said:

They’re not the only ones with headwind either but tbh Aston Martin’s R&D challenges are surely very small in comparison to others. They’re mostly doing an infotainment upgrade, the rest of the industry is putting in multiple billions in EV tech.
LS has clearly seen the interior as a weakness and decided to upgrade them all. It’s not a crazy strategy I would have thought.

Yes.

On your last point, were AML too slow to react and therefore forfeited many sales over 6 years?
I appreciate that LS did not arrive until halfway through that period, but in 2018, there were comments from many posters on this forum, that the new Vantage interior was not 'wow'.

The original technical agreement with Mercedes-Benz, did not allow AML to use of their latest infotainment, so perhaps that might have been one limitation. The sales figures suggest that millions in revenue must have been lost.

At last now sorted, so hopefully the buyer demand will increase.
Obviously impossible to make any meaningful debt and interest payment reduction, until continual profitability can be achieved.

[Jon39]

Forester1965 said:

I don't see them surviving as a sole entity.

Two of the attributes that Lawrence Stroll has brought to Aston Martin, has been raising expectations and also a remarkable ability to repeatedly make shareholders hand over cash.
Both very important for a business that is unable to generate cash.

The figures indicate that it might be possble, that we see yet another cash raise this year. However, with several new model announcements fresh in shareholders' minds, that should OK.
Wonder if they will try another 1 for 20 issue? A great trick to make some shareholders feel better.

[Jon39]

Rjscharer said:

Just would like to cast a spotlight on an advertised discounted price here in the states for a new Vantage.

This leads on to an interesting situation.

AML vehicles are sold to their dealers and I think payment is usually due soon after delivery.
With 'run-out' DB11, Vantage and DBX models already at dealers, significant discounts offered must presumably be shared between AML and the dealer.
When the over stocked Vantages were offered at bargain PCP prices, that promotion cost AML £35 million.
With three models now involved, there might therefore be a material write down in future AML accounts.

[Jon39]

SSO said:

Thankyou4calling said:

250 DBX'S and total sales of 950.

Seriously that just can't continue.

It's less than half of even average.

Is a far cry from the original target of 6,000 per year.

Just finished my analysis of Q1. In terms of wholesales, worst quarter since Q2 2020.

The unusual Aston Martin cost control model, can be traced back to and probably beyond, Sir David Brown.
Remember the tale, "Yes, you can have your car at cost price. That will be an extra £1,000."

“Annual income twenty pounds, annual expenditure nineteen pounds nineteen and six, result happiness.
Annual income twenty pounds, annual expenditure twenty pounds nought and six, result misery.”

I have referenced the Q1 reduction in SUV sales.
AML seem to make a habit of leaking information about forthcoming new models. Therefore some (perhaps many) potential purchasers must put off buying, when they become aware of model improvements.
AML give the changeover of models, as one of the reasons for the Q1 sales reduction. Of course, if those delayed buyers now proceed with their purchases, the numbers should recover, but if they might have become bored of waiting, or don't like the significant price increases, then it will be soup and in it.

[Jon39]

balise said:

Not far off in the uk. £90k now, much better to park your money in a Urus I think.

A wide choice now at around £100,000.
Works - 2 years old, 12,000 miles, £110,000.
compared with,
Main dealer - 707, 6 months old, 2,000 miles, £175,000

[Jon39]

Thankyou4calling said:

LS regularly rejoices that such a huge percentage of customers are new to the brand.
Given that we accept that as a fact a couple of questions
1. What's happened to all the existing customers given that sales volumes are 50% down.
2. If they're relying on a constant influx of new customers then are they doomed as it's not a bottomless pit.
Thanks

As you know, (for example) gaining one new customer and losing two existing customers, is going backwards.

We seldom hear much on here these days about repeat buying.
This topic has 11 pages, https://www.pistonheads.com/gassing/topic.asp?h=0&...
compiled by owners who bought more than one Aston Martin.
I am sure that one reason for not 'trading up' now, is the huge arithmetic difference between the value of a present car owned and the new prices. Inflation has obviously had an effect on widening that gap, which is unfortunate for AML.

Perhaps ever increasing congestion is also dissuading some buyers of fast, expensive cars. If so, that is yet another factor outside Aston Martin's control.

....................................................................

Unrelated to this topic, but there is an Aston Martin connection.

Henrik Fisker is a name that we know. Design Director at Aston Martin in the DB9 and V8 Vantage era.
He claimed those two cars were designed by him, although Ian Callum tells a different version of events.

Following time at Tesla, HF entered the world of car manufacturing.
(figures from Wikipedia)
His venture, Fisker Automotive raised a total of $1 billion from private investors. In 2013 voluntary bankruptcy was declared.

Another venture, Fisker Inc. There was an Initial Public Offering in 2020.
Those shares peaked at $28-50, but are now 3.7 cents.

Presumably the Fisker Inc investors would have been new investors, not the same ones who previously learnt the hard way with Fisker Automotive.
I believe the latest news is that production of the Fisker Ocean electric SUV has now stopped. 214 Fisker cars were sold in the UK during Q1 2024.

Will he try again ?
Perhaps raising money could be tricky with that track record.

Edited by Jon39 on Friday 10th May 17:32

[Jon39]

A generally successful investment strategy (although not with AML shares).
Buy and hold long-term, often proves to be a very worthwhile strategy. Ask Mr. Warren Buffett ($130 billion) about his 'hold forever' stocks.

One reason for this, is that no one knows when a market is suddenly going to rise.
Share buyers who attempt to 'time the market', tend to miss out on these events,
hence the saying, "Time in the market, beats timing the market”.

After a lacklustre period, the UK stock market suddenly increased by 6.75%, during the past three weeks.
Completely unpredictable.