Aston Martin raises £211m from investors after profit warning

Aston Martin Lagonda has raised £211million in new financing to help bolster its liquidity and fund future growth after issuing a profit warning on Tuesday. 

The struggling luxury carmaker revealed it had issued £100million in new debt and obtained £111million from investors buying its shares for 100p each, a 7.3 per cent discount to its closing share price yesterday.

Lawrence Stroll’s Yew Tree Consortium, which bailed out the company in early 2020, subscribed to about £50.5million of ordinary shares.

Following the fundraising, the business said it would end 2024 with an anticipated liquidity position of approximately £500million. 

Aston Martin announced a planned share and debt placing on Tuesday at the same time it declared its second profit warning in two months.

Due to what it called a ‘minor delay’ in delivering some of its ultra-exclusive Valiant vehicles, the company now forecasts its adjusted earnings before nasties will total £270million to £280million this year.

The Warwickshire-based group said it would deliver around half of the 38 Valiant models by the end of 2024, with the remainder coming early next year.

In September, Aston Martin cut profit guidance because of supply chain challenges and subdued demand from China, the world’s biggest automotive market.

It also said wholesale volumes were set to decline instead of grow, while free cash flow is predicted to ‘remain negative’.

To try and turn things around, the group has launched expensive new ranges like the DB12 and Vanquish and attracted significant investment from Chinese car giant Geely and Saudi Arabia’s Public Investment Fund.

However, it has continued to make massive annual losses, including a £239.8million pre-tax loss in 2023 and a £495million loss the year before, despite its vehicles selling for record average prices.

In September, former Bentley Motors boss Adrian Hallmark became the firm’s fourth chief executive in four years.

Commenting on the financing package, Hallmark said: ‘We thank our investors, including our strategic investors who continue to show strong support for the company, for their commitments and confidence in Aston Martin.

‘We are now well positioned for growth, underpinned by the strength of our brand and the world-class product portfolio we have brought to market.’

It intends to invest the money on repaying debts and capital investments related to its £2billion five-year ‘transition to electrification’ plan.

The carmaker expects to launch its first battery-electric vehicle in 2026, having previously anticipated bringing it to market next year.

Susannah Streeter, head of money and markets, Hargreaves Lansdown, said: ‘Aston Martin might be known for its association with James Bond, but there’s no secret agent in sight to pull it out of its latest scrape.’

Aston Martin Lagonda shares were 4.8 per cent lower at 102.7p on Wednesday morning, more than 90 per cent down on its £19 IPO price.

DIY INVESTING PLATFORMS

AJ Bell

AJ Bell

Easy investing and ready-made portfolios

Hargreaves Lansdown

Hargreaves Lansdown

Free fund dealing and investment ideas

interactive investor

interactive investor

Flat-fee investing from £4.99 per month

Saxo

Saxo

Get £200 back in trading fees

Trading 212

Trading 212

Free dealing and no account fee

Affiliate links: If you take out a product This is Money may earn a commission. These deals are chosen by our editorial team, as we think they are worth highlighting. This does not affect our editorial independence.

Compare the best investing account for you