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Restructure keeps Inchcape in profit

Inchcape this morning reported a pre-tax profit before exceptional items of £190.7m from its trading in 2008.

That compared with £235.1m in 2007. Operating margin has also declined to 3.8% from 4.4% in 2007.

Net debt was reduced from £540m in November 2008 to £408m at the year-end.

Andre Lacroix, chief executive, said: "Recent market conditions have been unprecedented and extremely challenging, affecting the entire car industry on a global basis.

"We have responded swiftly by reducing our cost base, right sizing the business for the current environment and deleveraging the group."

The London-based international motor retailer has also announced plans to raise £232m through a new shares issue.

The cash would be used to reduce gearing, decrease finance charges and delay its refinancing requirement until 2012.

Lacriox said the group is well placed to gain market share during the recession.

March order levels at its UK operations were in line with the board's expectations, he added.

"While we believe trading conditions will remain extremely challenging throughout 2009, we are confident that the actions we have taken put us in a strong position to deliver a solid performance this year. Looking further ahead, Inchcape is positioned to take advantage of growth opportunities as markets recover.”

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