Caffyns believes that the actions it has taken over the year can turn around its decline in profits.
The company saw a pre-tax loss of £4.42 million, compared with a profit of £2.58 million a year earlier. The group reported a loss from continuing operations of £3.97 million, compared to a profit of £2.13m in 2008.
Despite the results, Caffyns chairman Brian Birkenhead remains positive. He said: “The actions we took during the year to arrest the decline in profits and to return the company to a sustainable level of profit have begun to show results. It is encouraging that we traded profitably in our final quarter to March 2009.
“Our new car sales volume has declined by less than the market, costs have been cut with reductions in manpower and operational processes are undergoing major improvement.
This means that we are stronger, leaner and better able to cope with the difficult economic conditions and we are well placed to take advantage of the upturn when it arrives.”
Caffyns closed three branches (Tonbridge, Brighton and Halisham) over the year period at a cost of £754,000, with customers transferred to nearby dealerships.
Overall employee numbers have fallen from 778 to 646 at a cost of £455,000 which is being treated as a non-recurring expense.
The cost reduction measures will save Caffyns £2.5 million a year.
Caffyns’ full year new car sales were down 21% with average unit prices down 4%. Used car volumes were up 6% for the year, although prices were lower by 9%.
As a result revenue for the year was £158.7 million, 13% down from last year’s £182 million.