FTSE 250 movers: Aston Martin crashes after guidance cut

Aston Martin has revealed that full-year profits are now expected to decline as a result of a cut to wholesale volume guidance due to supply chain disruption and weak demand in China.

The luxury carmaker, officially known as Aston Martin Lagonda Global, said on Monday it was reducing wholesale volume forecasts for 2024 by 1,000 units due to tough market conditions. It also said it needed to "smooth the cadence of wholesale volumes over the coming quarters to deliver on its demand-led approach and maximise production efficiencies".

Vehicles are taking longer to complete, which is affecting the efficiency of operations and delaying deliveries, while the macro environment in China remains tough, Aston Martin said.

As a result, adjusted EBITDA for the full year will now be "slightly below" 2023, while the target of positive free cash flow in the second half will not be achieved.

At the time of its half-year results in July, Aston Martin said it had expected "enhanced profitability and EBITDA" for the full year, and that free cash flow generation would see an inflection point after outflows registered in the second quarter.

Chief executive Adrian Hallmark, who joined the board last month, said that "near perfect execution" was required to meet the company's ambitious 2024 targets.

"External factors within the global automotive industry, including supply chain disruption and weak demand in China, are now impacting Aston Martin's volume outlook for the remainder of 2024. Concurrent with the significant ramp-up in production for the second half of the year, following new model introductions, the company is experiencing a growing number of late component arrivals due to disruption at several of its suppliers," the company said in a statement.

Fidelity China Special Situations made more gains on Monday after three Chinese megacities announced the relaxation of home buying rules in the latest round of measures aimed at boosting the country’s ailing economy, while the central bank said it would ask lenders to lower mortgage rates.

Guangzhou and Shenzen on Sunday said they would lift all restrictions on home purchases, while Shanghai said it would ease restrictions on housing purchases by non-local buyers and lower the minimum downpayment ratio for first homebuyers to 15% from 20%

The People’s Bank of China said it would tell banks to lower mortgage rates for existing home loans before October 31, as part of continuing efforts to support the country’s troubled property market.

Commercial banks should, in batches, reduce interest rates on existing mortgages to no less than 30 basis points (bps) below the Loan Prime Rate, the central bank’s benchmark rate for mortgages, the PBOC said in a statement.

Wizz Air fell as airlines started pulling flights to the Middle East as Israel continued its assault on Lebanon.

Market Movers

FTSE 250 - Risers

Hammerson (HMSO) 319.40p 901.88%
Fidelity China Special Situations (FCSS) 223.00p 4.21%
North Atlantic Smaller Companies Inv Trust (NAS) 4,000.00p 2.04%
W.A.G Payment Solutions (WPS) 84.80p 1.68%
Baltic Classifieds Group (BCG) 303.50p 1.68%
Drax Group (DRX) 648.00p 1.09%
Greencoat UK Wind (UKW) 140.60p 0.93%
AO World (AO.) 110.80p 0.91%
NCC Group (NCC) 178.40p 0.90%
Energean (ENOG) 901.50p 0.84%

FTSE 250 - Fallers

Aston Martin Lagonda Global Holdings (AML) 121.30p -23.95%
Carnival (CCL) 1,217.50p -4.25%
Wizz Air Holdings (WIZZ) 1,459.00p -4.20%
Centamin (DI) (CEY) 146.90p -4.05%
PureTech Health (PRTC) 148.40p -3.89%
PRS Reit (The) (PRSR) 101.80p -3.05%
Bank of Georgia Group (BGEO) 3,660.00p -3.05%
Johnson Matthey (JMAT) 1,517.00p -2.94%
Sirius Real Estate Ltd. (SRE) 97.20p -2.75%
Jupiter Fund Management (JUP) 86.30p -2.71%