Car supermarket chain Motorpoint Group reports its work to shore up gross profit per unit has progressed, with margins returning to normalised levels over the past six months.
It comes after its first half trading results last November showed a 32% slump in operating profits and a rise in marketing spend.
In June the publicly listed company will report its results for the 12 months to March 31. However its trading statement today stated it expects turnover for the year to come in at around £820m, a 12.5% increase year-on-year, and added that profit before tax is expected to be at the upper end of current market expectations, thanks to improving margins and a positive contribution from its most recently opened sites at Castleford and Oldbury.
“The final quarter of the group’s financial year in particular has seen increased customer footfall and online traffic, driving improved volume performance both in like-for-like sales and sales at new sites,” Motorpoint added.
Looking forward, Motorpoint’s board “is cautiously optimistic regarding the UK used vehicle market and remains confident that Motorpoint’s independent and flexible model ensures the group is well placed to continue to grow market share”, it said.
Motorpoint’s 12th site is scheduled to open in Sheffield later this month, which Motorpoint described as “a key strategic market for management to expand the company’s penetration across Yorkshire”. It said there remains a good pipeline of new site opportunities across the UK.
Mark Carpenter, chief executive, said: “We are pleased with our improved trading performance in the second half of the year, with the business responding well following the pricing actions of the first half, thereby driving profit towards the top end of consensus range.
“We anticipate continued growth in revenues and profits, with an encouraging performance from our new sites.
“Motorpoint operates a compelling customer proposition and is well placed to continue building on the competitive advantages of its unique model.
“With four sites under three years old and our new Sheffield site opening in April, we are excited about the group’s prospects and look to the future with confidence.”