Aston Martin shares plummeted nearly twenty per cent this morning after the marque issued a profit warning, blaming supply chain issues and “continued macroeconomic weakness” in China. The FTSE 250 group expects both wholesale production volumes and adjusted earnings before interest, taxation, depreciation and amortization (EBITDA) to come in below market expectations this year. Aston Martin had put its hopes on a significant production ramp up in the second half of the year after losses widened in the firm’s half-year results in July.
But Monday’s profit warning and news it would produce around 1,000 less cars sparked panic among investors, as it became clear the marque had failed to pull-off its strategy. Shares dropped 18.43 per cent to the bottom of London’s mid-cap index by mid-morning trading.
Wholesale volumes are expected to decline by a “high single digit percentage” year-on-year, Aston Martin said in a statement to markets. Gross margins are expected to be “modestly below” 40 per cent, down from a prior target of circa 40 per cent. Adjusted EBITDA is forecast to fall in the high teen’s percentage, having been previously in the low 20s.
“Near perfect execution was required to meet the Company’s ambitious 2024 plan,” Adrian Hallmark, Aston Martin’s chief executive officer, said. “However, it has become clear that we need to take decisive action to adjust our production volumes for 2024 given a combination of supplier disruption, the weak .