Aston Martin profits up as company confirms IPO
Luxury car manufacturer Aston Martin has confirmed its intention to float on the London Stock Exchange in a flotation that could value it at £5bn, as the company reported increased profits in its half-year results.
Read more: Aston Martin to IPO in £5bn stock market listin
The figures
The UK-based company revealed revenue was up eight per cent year-on-year to £445m and adjusted underlying profits were £106m, an increase of 14 per cent for the six months ended 30 June.
First half wholesale volumes increased in the Asia Pacific region, with overall production volumes standing at 2,299 units, down from 2,439 in the first half of 2017.
The company expects production to reach between 6,200 and 6,400 cars in the second half of the year, and predicts strong growth driven by demand for new Vantage and DBS Superleggera models.
Why it's important
Aston Martin confirmed today that it plans to float on AIM, with analysts estimating a £4bn-£5bn valuation.
Registration documents for the IPO are expected to be published later today while the prospectus will be revealed on 20 September.
The potential structure for the IPO includes the secondary sell-down of existing ordinary shares.
German manufacturer Daimler AG, which holds a stake of 4.9 per cent, will remain a shareholder.
Aston Martin employees and customers will be able to apply to purchase shares at the offer price, and the company said it will have a free float of at least 25 per cent.
What the CEO said:
President and chief executive Andy Palmer said: "Today's announcement represents a key milestone in the history of the company, which is reporting strong financial results and increased global demand for its award-winning sports cars."
What the analyst said:
Hargreaves Lansdown senior analyst Laith Khalaf said: "While we’re disappointed there isn’t a retail offering within this IPO, private investors will at least be able to buy shares on the secondary market when they start to trade.
"There are few people who wouldn’t want an Aston Martin on their drive, and even fewer who can afford one. However this stock market float allows investors to buy into a little of the glamour of Aston Martin, without getting a second mortgage.
"It’s important for potential investors to concentrate on the company’s financial prospects and not to get carried away by the brand however, and that means having a thorough read of the forthcoming prospectus.
"Aston Martin could be valued at between £4bn to £5bn, which would put it at the top end of the FTSE 250 ahead of companies like Travis Perkins and William Hill, and nipping at the heels of FTSE 100 stalwarts like M&S and Royal Mail."
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