“Strong cash inflows from operations and the proceeds from a number of businesses sold recently under our manufacturers' market area strategies have bolstered cash surpluses in the motor division,” he added.
“Other opportunities to fulfil the group's medium term plans are being evaluated.” Vardy predicts block exemption changes will accelerate moves by manufacturers to reduce the number of dealer partners who would each receive larger territories and a greater share of the market. He expects all existing franchise agreements to be terminated by the end of the month and replaced with new arrangements by the end of this year.
“The directors believe that the group will be a major beneficiary of the changes currently taking place as a result of the new block exemption regulations,” says Vardy.
In July, the dealer group posted record profits - up 33.5 per cent to £33.5m - for the year ended April 30 on turnover up 6.4 per cent to £1388m. Vardy revealed he had a £100m war chest to spend on acquisitions as the group chased a £2bn turnover.