Good morning to everyone. Before I hand over to Doug for his financial review, I want to provide some high-level comment about the overall performance of the company last year. 2022 was a year of considerable progress for Aston Martin, as we accelerated our journey to become the world most desirable ultra-luxury British performance brand. While the year will be remembered for the many challenging and unpredictable external factor which have impacted both the global economy and Aston Martin, it has also been a year that has seen us continue to build the foundation for our long-term growth. Having navigated a challenging operating environment throughout 2022, I am pleased with how we ended up the year. Most importantly, we continue to see strong demand across the portfolio and across our region.
For 2022, we deliver on our outlook, have taken action to address the short-term impact on supply chain issues, and continue to make progress in a number of areas that will support our ability to meet this strong customer demand and enhance our long-term growth and profitability. The product side, 2022 saw us launch and deliver the start of a breathtaking lineup, which will be supercharged by the launch of our next generation of front-engines sports car and high-margin special. We injected fresh energy to our iconic brand through the launch of a bold creative strategy and global marketing campaign. This has further accelerated our growth among new audiences, amplified by our partnership with the Aston Martin Aramco Cognizant Formula One team. I am also proud of the progress we have made toward the goals in our sustainability strategy, Racing. Green.
This is something that is really shaping our transformation and ensuring that we have made sustainability central to everything we do. I will now hand over to Doug, who will take you through the financial. I will then come back and talk through our strategic process and positioning moving forward.
Thank you, Amedeo, and good morning, everyone. I'll run through a summary of our financial performance for 2022 before spending some time taking you through our outlook for this year and how we expect the trajectory of our financial performance to develop and accelerate over the coming quarters. I'll finish by providing some comments on the progress we're making towards meeting our midterm financial targets. Starting with a high-level overview of our results for 2022. In addition to meeting the revised outlook for the year, I'm pleased with the overall progress we have made as we aim to accelerate our growth and further improve our profitability in 2023. At the top left of the slide, wholesales increased by 4% to 6,412 units, driven by strong volume growth in Q4.
Revenue increased by 26% year-on-year to GBP 1.4 billion, driven by record ASPs, reflecting strong pricing dynamics, improved core mix, higher Valkyrie deliveries, and foreign exchange tailwinds. Adjusted EBITDA of GBP 190 million increased by 38%, delivering 120 basis points of year-on-year margin expansion. Moving to the top right, the increase in operating loss essentially reflects higher depreciation and amortization, while free cash flow was impacted by higher CapEx, as well as a change in working capital movements when compared to 2021. Aligned with my comments last quarter, it is worth calling out that we delivered positive free cash flow of GBP 37 million in Q4. Net debt decreased year-on-year to GBP 766 million, despite a negative GBP 156 million non-cash impact from the FX revaluation of our U.S.
dollar-denominated debt. Sequentially, this revaluation improved significantly from GBP 245 million we reported at the end of Q3 due to the relative recovery of sterling versus the U.S. dollar in Q4. Now, looking at full year wholesales and ASPs in more detail. Despite a challenging and uncertain operating environment, total wholesales increased by 4%, driven by strong demand across the portfolio. On the left-hand side of the slide, we have the breakdown of our models, with DBX representing approximately 50% of the mix, supported by the launch of the DBX707. Given significant supply chain and logistics disruptions, most notably in Q2 and Q3, which delayed our ability to meet customer demand, we delivered a strong Q4, and unsurprisingly, this represented the peak of our volumes for the year.
It is worth noting that due to the timing of vehicle deliveries towards the end of the year, total wholesale volumes were temporarily ahead of retail volumes. A high percentage of those vehicles were retail tagged, and we expect to see retails outpace wholesales again going forward, aligned with our demand led strategy. On the right-hand side of the slide is wholesale average selling price, which was one of the highlights of the year. Both core and total ASPs reached new record highs, reflecting the strengthening of our pricing power, supported by the repositioning of the Aston Martin brand over the last three years. We expect this trend to continue as we commence the rollout of our next generation sports cars and high-margin specials.
Core ASP was GBP 177,000, an increase of 18% year-on-year, driven by strong pricing and mix dynamics as well as foreign exchange tailwinds. Total ASP of GBP 201,000 for the year, an increase of 24%, also reflected higher year-on-year deliveries of the Valkyrie. Turning to the geographical split. As you can see, wholesale volumes remained well-balanced across all regions, reflecting the broad customer appeal of our portfolio. Within this, it is worth mentioning that macroeconomic and supply chain disruptions throughout the year impacted our ability to fulfill strong customer demand. This also impacted our geographic and product mix, which resulted in some exaggerated quarterly fluctuations in our volume metrics. Amidst this environment, the Americas and APAC were the largest regions, collectively representing approximately 60% of total volumes.
Overall volumes in the Americas were flat year-on-year, as higher sports car volumes and deliveries of the V12 Vantage offset lower DBX volumes, which were impacted by the disruptions we experienced earlier in the year, delaying the timing of DBX707 deliveries. Despite geopolitical challenges, EMEA wholesales increased by 19% year-on-year, driven by strong customer demand and deliveries of the DBX707 and higher year-on-year sports volumes. Finally, U.K. volumes were also flat year-on-year as higher DBX volumes were offset by lower GT sales. Moving to gross margin, which is a key building block of our future ambitions and an important benchmark for any luxury business. 2022 saw us continue to make progress on our journey to achieving a 40%+ gross margin with 120 basis points of year-on-year expansion.
As you can see on the slide, there were three distinct operational drivers of our gross margin performance. Two of which I would describe as more transitional, whilst the other represents a more structural shift in profitability. Starting with the structural driver, which relates to our core gross margin performance and trajectory. From the DBX707 and final edition V12 Vantage onwards, our new core products target a 40%+ gross margin as we continue to reposition the company towards ultra-luxury and high performance. As you can see in the bridge, the underlying gross margin of the core range drove approximately 400 basis points of the year-on-year improvement to overall gross margin. As we introduce the full range of our next generation of front-engine sports cars, we expect gross margin from the core range to continue to improve into 2023 and 2024.
High-margin specials are also an important part of our overall strategy, and we have an exciting pipeline of specials. For example, the DBR22 and the 110th year anniversary special, both of which support this strategy. During 2022, we saw a transitional shift in our current mix of specials related to the significant year-on-year increase in Valkyrie deliveries, particularly in the second half, and the lapping of high-margin V12 Speedster deliveries from 2021. This translated into an approximately 300 basis points drag on overall gross margin in 2022. Why is this a transitional impact? Well, there are a couple of reasons. First, we expect Valkyrie gross margin to improve significantly in 2023, driven by improved customer mix and the first deliveries of the Valkyrie Spider.
Second, we expect higher deliveries of a richer mix of high-margin specials, which leverage existing vehicle platforms such as the DBR22 and the 110th anniversary special. The benefits of which we expect to see start coming through in late 2023. In terms of providing some color on Valkyrie gross margin, customer mix has been a headwind to our performance this year, particularly in the second half. As we disclosed in June 2021, we filed proceedings against Nebula Project and its board members related to customer deposits being taken but not passed on to Aston Martin. Since then, we've continued to work with the affected customers to ensure they receive their Valkyries.
However, this not only impacted our profitability in 2021, as previously disclosed, but as also stated at the time, further impacts had been factored into our forward financial planning. As we've increased our Valkyrie deliveries in 2022, including a higher proportion to those customers affected by the Nebula situation, the year-on-year impact on our profitability increased. Looking ahead, we expect this transitional headwind to ease in 2023. Finally, and as flagged at our Q3 results, our gross margin in 2022 included material levels of supply chain recovery costs related to the specific disruptions we experienced mainly through Q2 and Q3. This equated to approximately GBP 20 million or more than 100 basis points of gross margin.
I'll come back to gross margin when I take you through our outlook for 2023 in a few moments. On this slide, you can see the details of our adjusted EBITDA, which increased to GBP 190 million with a 13.8% margin. The biggest positive driver was the strong pricing dynamics we delivered throughout the year as we benefited from the price increases we were able to implement and continue to execute a reduction in retail and customer financing support. Mix was a further positive, supported by deliveries of the DBX707 and V12 Vantage. We also enjoyed FX tailwinds to profitability, mainly due to the strength of other currencies versus sterling.
These factors were partially offset by a GBP 55 million increase in net operating expenses, driven predominantly by planned investments in marketing initiatives to support new launches and the ongoing elevation of our brand. In addition, broad inflationary impacts, as well as higher overall G&A to support our future growth, also contributed to the increase. On the right-hand side of the chart and looking below EBITDA. As previously guided, D&A increased year on year, driven by higher Valkyrie deliveries, as well as accelerated amortization of capitalized development costs ahead of the next generation sports cars. Net adjusted financing expenses increased significantly versus 2021, driven by the GBP 156 million non-cash FX revaluation of our U.S. dollar-denominated debt. Moving on to cash flow.
Starting with the loss before tax and adding back D&A and other non-cash items resulted in GBP 142 million of cash generation. Working capital was a GBP 15 million outflow compared to a GBP 56 million inflow in 2021. The outflow was primarily driven by a GBP 78 million increase in inventories, which was mainly driven by supply chain and logistics disruptions, particularly in the second and third quarters. This was offset by a GBP 82 million payables inflow, principally associated with higher accruals related to new product rollout plans as well as higher overall costs. Demand for specials remained strong throughout the year, with deposit intake for the Valkyrie Spider and Valhalla offset by the unwinding of customer deposits, given ongoing Valkyrie deliveries. This resulted in a net GBP 18 million outflow from deposits.
Relative to the significant working capital build we had at the end of Q3, we did see a partial unwind of inventories and improvements in cash collections, which supported our positive free cash flow performance in Q4. CapEx of GBP 287 million increased year-over-year, but was slightly below our previous guidance, with some rephasing of spend into 2023. Net interest paid was GBP 139 million. These movements resulted in a free cash outflow of GBP 299 million for the year. Turning to cash and debt. Our liquidity position was strengthened in 2022, and we ended the year with GBP 583 million of cash and reduced our net debt. This was facilitated by the proceeds from last summer's GBP 654 million equity capital raise.
As a reminder, we used GBP 187 million of the proceeds to secure the repurchase of first and second lien notes in early Q4. The breakdown of our net debt is outlined in the table on the right-hand side of the slide. In addition to the cash flow dynamics I've described, year-on-year net debt was inflated by the non-cash FX revaluation of our U.S. dollar bonds that I mentioned earlier. Looking ahead to our outlook. From a volume perspective, we expect to deliver an increase in wholesales to approximately 7,000 units in 2023, influenced by strong customer demand for the DBX707 and accounting for the planned timing of product launches and deliveries in both core and specials.
We also expect to deliver significant growth in profitability compared to 2022, primarily driven by the increase in volumes and higher gross margin across both core and specials. This should result in meaningful progress on our medium-term journey towards delivering a 40%+ gross margin. This combination of volume growth and margin enhancement is expected to deliver healthy year-on-year adjusted EBITDA margin expansion, increasing up to around 20% compared to the 14% we delivered in 2022. In terms of the profile of the year, which we think is an important element for us to be clear on, we expect our adjusted EBITDA and free cash flow performance in the first half of 2023 to be similar to the first half of 2022.
H1 will largely be shaped by both strong year-on-year growth in DBX volumes, as well as commencing the transition of sports car sales ahead of new launches later in the year. More specifically, we expect broadly similar free cash outflow outcomes in Q1 and Q2 due to the expected phasing of deliveries, capital expenditure and working capital dynamics in Q1 and the timing of cash interest payments related to our senior secured notes in Q2. In addition, we expect SG&A and CapEx phasing in absolute terms to be slightly more weighted towards the first half of the year. In the second half of 2023, we expect to see significant year-on-year growth and positive free cash flow, which should provide us with strong momentum as we head into 2024.
Our expectations of a strong second half performance are primarily driven by initial deliveries of a number of new products across the core and specials ranges, all with improved profitability. In addition to the bulk of the deliveries of the already sold-out DBS 770 Ultimate, we expect deliveries of the first of the next generation of front-engine sports cars to commence in Q3 and to make up a significant proportion of our volumes in Q4 as we ramp up production. Within specials, we plan to commence deliveries of the sold-out Aston Martin Valkyrie Spider and the ultra-luxury DBR22 in the second half of the year. In celebration of our historic 110th year anniversary, we plan to launch a new, strictly limited exclusive sports car with deliveries commencing in Q4.
Commensurate with our anticipated product launch strategy, we expect to increase our investment in brand and new product launch activities during the year. This also allows us to continue to elevate our ultra-luxury performance brand positioning and, importantly, support the acceleration of our long-term growth. In the context of our anticipated growth, it is worth noting that the operating environment remains volatile, including ongoing inflationary pressures and pockets of supply chain disruption. As mentioned by Amedeo, our teams continue to work in partnership with our suppliers to mitigate any impact on our performance. Cash interest is expected to be around GBP 120 million, down approximately GBP 20 million from 2022. Capital expenditure is expected to increase year-on-year, primarily driven by four factors.
A rephasing of spend from 2022, the impact of significantly higher year-on-year inflation on salaries and other costs, incremental investments related to the 110th year anniversary model referenced earlier, which will accelerate our growth in Q4 and into 2024. An increasing spend on electrification, alongside the final year of significant expenditure associated with our ICE portfolio. We expect this year to be the peak year of capital expenditure, with CapEx readjusting from 2024 to support both the development and delivery of our future product range and our target of becoming sustainably free cash flow positive from 2024. Looking further ahead, our midterm financial targets remain unchanged, and it is our expectation that we will exit 2023 with strong momentum to support the delivery of those targets.
It is also our expectation that 2024, supported by the timing of new product launches, will see a smoother delivery of our financial performance with greater balance between each quarter compared to recent years and, as I just outlined, our expectations for 2023. In closing, 2023 will be a year where our transformation accelerates, particularly through the second half. Alongside Amedeo, I'm focused on ensuring that we continue to execute our plans, mitigate risks, and deliver value to our shareholders. We look forward to providing more details on our future plans at a Capital Markets Day to be held over the summer. Thank you, and I'll now hand back to Amedeo.
Thank you, Doug. As I mentioned earlier, 2022 was a year of considerable progress for Aston Martin, and I would like to spend a few minutes going into this in more details, focusing on four areas that underpin our strategy and future growth ambitions. These are brand, product innovation, sustainability, and people. Starting first with our iconic brand, which is entering its 110th year and an exciting new chapter. Through the action we have taken in recent year, we have made tremendous progress in rejuvenating our brand and go-to-market strategy, aligned with our ultra-luxury and high-performance positioning. In 2022, we have launched a bold new creative brand strategy and global marketing campaign to further accelerate our growth amongst new audiences. This has been further bolstered by our partnership with Aston Martin Aramco Cognizant Formula One Team.
The brand idea, Intensity. Driven., build on Aston Martin strong established reputation for combining luxury craftsmanship and sophisticated design with our high-octane emotion and intense driving pleasure. This strategic repositioning is the largest investment in Aston Martin's brand for more than a decade. Strengthen our position at the pinnacle of the performance ultra-luxury segment. You can see some of the results of this strategy on the slide with more than 60% of our customers new to the brand. You now are going to see a video showing some of the 2022 highlights for Aston Martin. Moving to product, Aston Martin has one of the most comprehensive portfolio in the luxury automotive market, enhanced during 2022 with the launch of three new products that combine ultra-luxury with high performance and improved profitability.
Starting with our core range, in Q1, the DBX707, the most powerful luxury SUV on the market, was unveiled. Building on the success of the DBX, Aston Martin first SUV, the DBX707 elevated the company positioning and has set a new benchmark. Delivering of the DBX707 commenced in Q2 to extensive media acclaim and strong customer demand, the DBX707 represent more than 50% of our DBX volume in 2022. Our customer were delighted by the introduction of the new V12 Vantage coupe in March, the final edition of an iconic bloodline, which enjoyed unprecedented demand with all 333 units sold ahead of its release. This was quickly followed by the V12 Vantage Roadster, launched to similarly strong demand with all 249 units sold out.
Sticking with our limited edition models, we also unveiled the DBS 770 Ultimate at the start of 2023, the end of our current Super GT flagship and the most powerful production Aston Martin ever made. Moving to special, which are an important element for our business, 2022 saw us ramp up production and deliveries of the Valkyrie, a once-in-a-generation hypercar that pushes the boundaries for performances, we expect to commence to deliveries of the Valkyrie Spider in 2023. At Pebble Beach, we showed a number of development prototype for Valhalla, our hybrid supercar, which continue to see strong demand. Finally, we unveiled the ultra-luxury and award-winning DBR22, which celebrate our extraordinary bloodline of open cockpit sport racer. Looking ahead, 2023 is set to be a monumental year.
In addition to celebrating our 110th year history, it also marks the start of the transformation to our game-changing new generation of front-engine sports car. While I am not going to go into the details of these launches, in my opinion, this car will really showcase the repositioning of Aston Martin aligned with our vision, our focus on ultra-luxury, high performance, and drive intensity, as well as improved profitability. Of course, electrification is very much at the heart of our product development going forward, including our first plug-in hybrid, Valhalla, as well as Aston Martin BEV. Turning to sustainability, where we have accelerated our progress toward the Racing. Green goals that we have first set up in early 2022, and have deepened the integration of the sustainability into our business, making it central to everything that we do.
Reducing CO2 emission from the company product manufacturing processes and wider supply chain remain a top priority. We have implemented a range of project which will help make our manufacturing facility net zero and achieve our aim of 30% reduction in supply chain emission by 2030. We have also set up new additional target to drive year-on-year improvement in our sustainability performance to reduce CO2 emission and energy intensity for car by 2.5% each year. Our company-wide EV transformation program is equipping our people, changing our processes, and reshaping the organization for new electrified lower carbon future. Sustainability has also increasingly been embedded throughout the vehicle design processes, and we are intensified our focus on using material which are low carbon, sustainably sourced, and recycled.
In our manufacturing facilities in Gaydon and St Athan, we continue our commitment to use only renewable electricity, and we are making meaningful progress toward our target to achieve zero plastic packaging from our manufacturing facilities by 2025, and to cut out water consumption by 15%. In 2022, we announced our gender diversity goals with a target of 25% women in leadership position by 2025, rising to 30% by 2030. Last but not least, I want to spend a couple of minutes talking about our people and some of the changes we have made to support our future growth and achieve our target. My philosophy is simple: Making even the most extraordinary of cars is not difficult. It only requires the right organization, processes, and people.
One of my key priority has been improving our execution capability, leveraging my experience and the exceptional talent we have to implement changes throughout the organization. For me, it is crucial that we focus on the consistency and quality of our output to deliver the high standard that our customer and ultra-luxury position demand. What we have done. We have established a measure to address short-term issues, such as the supply chain disruptions, DBX707 derivative, as well as more structural changes to support future product launches, focus on innovation, quality, and overall efficiency. We have also implemented new ways of working to enhance our operational capabilities, all aligned to enhance our productivity and the delivery of our growth ambition. This has included a new cross-functional structure for the engineering organization to enhance the development of our next generation of high-performance vehicle and expanding our in-house engineering capability.
This is focused on areas such as Software & Electronics Technology , Infotainment, e-powertrain, as well as Product & Component Development . Over the course of the year, we renewed our commitment to making Aston Martin a great place to work, with a focus on fostering a spirit of collaboration. This is something I am personally involved in, and I believe will be key to our future success. Granted by the principle that no one builds an Aston Martin on their own, we introduced a new set of company values, and I am very encouraged of the engagement and the energy this has already sparked. In closing, we enter our one hundred and tenth anniversary year ready to write a new chapter in our proud history.
By continuing to focus on the consistency of execution of our strategy, this will allow us to leverage the incredible pipeline of products, our iconic brand, and our market opportunity, which will support the delivery of our target. I have great confidence in Aston Martin delivering on this potential, and I look forward to updating you on our progress and sharing more details at Capital Markets Day to hold this in the summer. Thank you.