Commentary

Aston Martin Revs Up Speculation That Its Cars, Scarves Will Go Public

Aston Martin, whose vehicles are seen more often on the big screen than on the streets of most neighborhoods, is putting its seven bankruptcies in the rearview mirror and is planning to go public on the London Stock Exchange later this year. Probably.

“The sports car maker has been considering an initial public offering for some time. But the timing and location of the listing have remained under wraps,” reports Charles Riley for CNN Money. “The company said Wednesday that it still has to make a final decision on whether to go ahead with the London IPO. It plans to publish more detailed information on the listing around September 20.”

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The average selling price of Aston Martin’s luxury automobiles is £167,000 -- or $217, 389.91 -- as of this morning, according to Alan Tovey in the Telegraph.

“The company’s main draw is its history as one of Britain’s most revered makers of lustworthy automobiles,” writes Michael J. de la Merced for the New York Times. “Its most famous customer, of course, was the superspy 007, who drove Aston Martins that fired machine gunsfeatured ejector seats and on at least one occasion turned invisible across 11 movies. (Regrettably, they rarely came back in one piece.)"

The company hasn’t fared all that well in the pothole-ridden street of solvency either, but its finances have made a U-turn.

“Once saddled with heavy losses, the manufacturer of James Bond’s car has been profitable for seven consecutive quarters and is generating sufficient cash to fund the development of new models, said Aston Martin’s chief financial officer Mark Wilson on Wednesday in an interview with CFO Journal,” writes Nina Trentmann for the Wall Street Journal.

“The 105-year old company recorded an 8% rise in revenue to £445 million ($578.6 million) for the six months ended June 30, and a 14% increase in adjusted earnings before interest, tax, depreciation and amortization to £106 million,” Trentmann adds.

“Aston has powered sales with new, more powerful models -- like the $200,000 DB11 and $300,000 Vanquish -- as well as pricey limited-edition runs like the Vanquish Zagato. Made famous for being the preferred ride for MI6 agent 007, the company recently announced plans to make 25 recreations of the famed 1964 DB5 driven by Sean Connery in ‘Goldfinger’ -- priced at more than $3.5 million each,” writes CNBC’s Robert Frank. 

“The company has also launched plans for an all-electric car division, called Aston Martin Lagonda, that will launch cars in 2021,” Frank adds.

“The plans for an offering signal a belief that even after Brexit, Aston Martin’s luxury sports cars and sedans will appeal to deep-pocketed auto buyers worldwide. In a regulatory filing, the company specifically said it stood to benefit from growth in ‘high-net-worth individuals’ worldwide, particularly in Asia,” the NYT’s de la Merced reports.

And those folks presumably are presumably eager to wear their wealth on their sleeves. And necks.

“The Aston Martin showroom in the heart of London’s Mayfair district features a car, of course. But it is surrounded by an array of other products the company is selling as it positions itself as a luxury brand, not just a sports car maker,” writes Rupert Neate, the Guardian’s wealth correspondent. “There are Aston Martin branded cashmere stoles (£230), luggage, a picnic hamper (£1,950), briefcases and washbags (£149). The Dover Street showroom is key to chief executive Andy Palmer’s mission to transform the 105-year-old company into a ‘luxury company and not just a car company.’” 

And “if driving and dressing in Aston Martin is not enough, it will soon be possible to live in the company’s branded apartment building in Miami. The 66-story tower will feature an infinity pool on the roof, an art gallery, two cinemas and an Aston Martin supercar parked in the lobby,” Neate continues.

“Bankers working on the deal are hoping that the company’s elevated prices will place it above the melee of the car industry, making the business akin not only to Ferrari but to other luxury labels such as Hermes, attracting global luxury investors rather than those hoping to make profits from banging together and selling metal boxes,” writes Peter Campbell for Financial Times.

“Luxury businesses have a nature of being able to survive tougher markets,” a source familiar with the company’s intentions tells Campbell. “As soon as you move into that segment your customer base becomes global, and there will always be luxury buyers looking for your product.”

And they do tend to become Bonded, too.

1 comment about "Aston Martin Revs Up Speculation That Its Cars, Scarves Will Go Public".
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  1. Marcelo Salup from Iffective LLC, August 30, 2018 at 10:28 a.m.

    This is not an investment, it's a risk:



    1. $600 million in revenues is chickenshit

    2. Only 7 consecutive profitable quarters in 105 year, or 420 quarters.

    3. Bankrupt 7 times



    Love the cars, would give a few fingers to be able to own one. But, this is just not rational.

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