STRATEGIC REPORT FINANCIAL REVIEW S Through continuous engagement with our stakeholders during the – FY 2023 core ASP of £188k, up 6% (FY 2022: £177k) TR year, I was pleased to see the development of both new and existing – Q4 2023 core ASP of £196k, up 7% (Q4 2022: £184k) A strategic relationships as we progress to deliver long-term value to all • Higher year-on-year Specials volumes with consistent delivery TE G I of our shareholders. This included increased investment by Geely of Aston Martin Valkyrie (87 compared to 80 in FY 2022) C Holding Group to become our third largest shareholder as part of a R including deliveries of the first Aston Martin Valkyrie Spiders, E new relationship agreement, a new strategic supply arrangement with DBR22 and Valour limited edition models: P O Lucid to propel Aston Martin’s high-performance electrification – FY 2023 total ASP of £231k, up 15% (FY 2022: £201k) R strategy, and increased investment by Yew Tree Consortium, – Q4 2023 total ASP of £255k, up 20% (Q4 2022: £213k); T demonstrating their continuing confidence and belief in the future reflecting richer mix of Aston Martin. – Significant increase in gross profit and margin progressing towards G O longstanding c. 40% target in FY 2024/25; reflecting benefits from VE Overall, 2023 has been a significant year of financial and strategic the ongoing portfolio transformation, driving favourable pricing R progress for Aston Martin. I am pleased with the steps we have made dynamics, product mix and volumes: NAN towards achieving our near- and medium-term financial targets, which • FY 2023 gross profit increased by 42% to £639m (FY 2022: C are underpinned by the exciting product transformation that we are £451m); gross margin at 39% (FY 2022: 33%) E undertaking. I thank all the teams that have supported the business • Q4 2023 gross profit increased by 63% to £268m to deliver our objectives this year and I’ll continue to work closely (Q4 2022: £165m); gross margin at 45% (Q4 2022: 31%) F with the Board to ensure we deliver value to all of our stakeholders. – FY 2023 adjusted EBITDA increased 61% to £306m (FY 2022: I NAN £190m) translating to an adjusted EBITDA margin increase of DOUG LAFFERTY 490 basis points to 18.7%; primarily driven by higher gross profit, C CHIEF FINANCIAL OFFICER IAL partially offset by 26% increase in adjusted operating expenses, including reinvestments into brand and marketing activities S T and inflationary impacts on the cost base, while recognising A T £11m relating to upward revaluation of investment in AMR E M GP Holdings Limited E N – FY 2023 operating loss decreased by 22% to £111m (FY 2022: T S £142m loss), including £78m year-on-year increase in depreciation 2023 has been a significant and amortisation; Q4 2023 operating profit increased to £34m year of financial and strategic F (Q4 2022: £7m) U R progress for Aston Martin.” – Net cash inflow from operating activities of £146m T H (FY 2022: £127m); Free cash outflow of £360m (FY 2022: E R £299m outflow) reflecting: INF • Q4 free cash outflow of £63m (Q4 2022: £37m inflow) impacted by timing of DB12 and Valour deliveries in December 2023 with OR related receivables unwinding in January 2024 M A 2023 FULL YEAR FINANCIAL SUMMARY • Higher year-on-year capital expenditure of £397m (FY 2022: T I – Delivered robust wholesale volumes during a period of ongoing ON £287m), primarily related to new models and next generation product portfolio transformation: sports car developments, as well as development of the • FY 2023 wholesale volumes increased 3% to 6,620 (FY 2022: Company’s electrification programme including the initial $33m 6,412); driven by 14% Sport/GT growth, reflecting growth in (£27m) payment to Lucid Group, Inc. (Lucid) relating to the new DB12 and DBS 770 Ultimate volumes in H2’23, despite slight strategic supply agreement delays to the initial production ramp up of DB12 • Net cash interest payments of £109m (FY 2022: £139m) • As expected, Q4 2023 wholesale volumes increased 54% • Working capital outflow of £86m (FY 2022: £15m outflow) sequentially compared with Q3 2023; decreased 6% to 2,222 reflecting timing of December deliveries and the unwinding of compared to prior year period (Q4 2022: 2,352) due to elevated customer deposits on delivery of Special wholesales, partially Q4 2022 wholesales offset by a reduction in inventory and payables – FY 2023 revenue increased 18% to £1,633m reflecting continued – Year-end cash of £392m (2022: £583m), following the redemption execution of our growth strategy; enhanced positioning of our of 50% of the outstanding second lien notes in November 2023 ultra-luxury brand and enriched product portfolio driving growth – Net debt of £814m (2022: £766m), including a positive £61m in volumes and record average selling prices (ASPs): impact of non-cash FX revaluation of US dollar-denominated debt • Strong pricing dynamics in the core portfolio and favourable as sterling strengthened against the US dollar during 2023; mix from DBS 770 Ultimate, DBX707, V12 Vantage Roadster disciplined strategic delivery supported ongoing deleveraging and new DB12: with net leverage ratio improving to 2.7x (2022: 4.0x) ASTON MARTIN LAGONDA ANNUAL REPORT AND ACCOUNTS 2023 38