Aston Martin keeps forecast, bets on Valhalla after wider-than-expected loss

(updates headline)

By Prerna Bedi

July 29 (Reuters) - Aston Martin kept its annual forecasts on Wednesday despite a wider-than-expected second-quarter loss, as the debt-laden luxury carmaker bets on sales of its Valhalla hybrid supercar, cost cuts and fresh funding to revive its fortunes.

The British carmaker, with roots stretching back over a century, has been grappling with U.S. tariffs, weakness in its key China market and liquidity pressures, while investors remain to be convinced that recent improvements are sustainable.

"We are on track to deliver material financial improvement this year compared with 2025," CEO Adrian Hallmark said, adding that the second half would be stronger.

The company's shares, which trade at less than one-hundredth of their 2018 listing price, were up 1.5% at 37 pence at 1003 GMT after initially falling as much as 2%.

TURNAROUND EFFORTS

Aston Martin has relied on cost cuts and funding from lenders to shore up its finances. Last week it raised £550 million ($731 million), while Executive Chairman and top shareholder Lawrence Stroll has injected more than £600 million into the company since taking control in 2020.

Known as the preferred car of fictional secret agent James Bond, Aston Martin continues to expect 2026 vehicle volumes in line with last year, with an adjusted operating margin improving towards breakeven.

The company said conditions across the automotive sector remained challenging because of the knock-on effects of the conflict in the Middle East, an important market for bespoke luxury vehicles. But it added the impact on Aston Martin had been limited so far.

"Maintaining full-year guidance while strengthening the balance sheet should give even cautious investors reason to take another look," said eToro analyst Mark Crouch. "The real challenge now is proving this improvement isn't just another lap."

VALHALLA: A BRIGHT SPOT

One bright spot has been Aston Martin's Valhalla plug-in hybrid supercar, with 220 sold in the six months to June.

Hallmark told investors the strongest quarter of the year for volumes, including Valhalla deliveries, was expected in the final three months of 2026, supported by U.S. demand and with no signs of price weakness.

The company's adjusted operating loss narrowed to £52 million in the second quarter from £57 million a year earlier, but was worse than analysts' consensus forecast of a £45 million loss in a company-compiled poll.

Rival Porsche also maintained its forecasts on Wednesday as it pursues a restructuring.

($1 = 0.7520 pounds)

(Reporting by Prerna Bedi in Bengaluru. Editing by Mark Potter)