Aston Martin backed its full-year guidance on Tuesday as it said it was suing Swiss car dealer Nebula Project and its board members for failing to pay some customer deposits for orders of the Valkyrie sports car.
The luxury car maker also said it was terminating the dealership arrangements it had with AF Cars, a company operating Aston Martin St.Gallen in Switzerland and managed by the same board members as Nebula, after learning that vehicles had been sold in breach of dealership agreement terms.
“Both Aston Martin and its customers have been impacted by Nebula Project AG’s and its board members’ behaviour,” it said. “Aston Martin is fully committed to supporting and working with those customers affected to ensure that they will still receive delivery of their Valkyrie programme vehicles as scheduled, prioritising customer relationships, despite the company not having received all the deposited funds.”
The net financial impact of the legal proceedings is expected to be positive over time, Aston Martin said, as the financial impact of not having received all the deposited funds will be outweighed by the benefit from the termination of the Nebula agreement and associated potential royalty payments.
However, for the year ending 31 December 2021, it is expected to reduce both cashflow and earnings before interest, tax and depreciation by up to £15m, including a provision of up to £5m of trade debtors. The provision is expected to be booked in the second quarter and for the remaining impact on cash flow and EBITDA to arise primarily in Q4.
“Other than the short term negative financial impact of this issue, Aston Martin is on course to achieve its financial guidance for 2021 and remains confident in achieving its medium-term targets of circa 10,000 wholesales, c.£2bn revenue and c.£500m adjusted EBITDA by 2024/25,” the company said.
