Aston Martin - Sarria Daily Comments 03/11/2021

ASTON MARTIN – (Aengus) We don’t believe Aston Martin will be providing the £200m capital needed by the Aston Martin F1 team after the F1 teams retail bond was shelved in favour of “more attractive sources of funding”. Given the prior cashflow issues at AML we expect the company to remain cautious. A co-investment with sharing for the Specials division is possible. It’s a question for management on the call tomorrow, but we are not agonising over it.

- AML is already building an innovation centre next to the F1 teams HQ and is seeking to use F1 technology to push its hyper cars. It is possible that AML could co-invest.

-AML does have an option to acquire a stakeholding in the F1 team, however whilst a capital raise might be more "attractive" it is going to be a lot more expensive for the F1 team.

-The 7% 5-year bond was to finance a new GBP200m wind tunnel at the F1 teams HQ in Silverstone. The F1 team is majority owned by Lawrence Stroll with AML providing the chassis for the F1 car.

- At this point we see no reason to change our thesis that the equity looks good value as we expect volumes to continue to impress. For now, the debt continues to look expensive.