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Vertu confident of full year performance

Vertu Motors is expecting its full year financial performance to be ahead of 2008 following a strong period of trading in the first six months of the financial year.

The pre-close trading update follows the announcement that Michael Sherwin has been appointed to the Vertu board as its new finance director.

Sherwin replaces Karen Anderson, who has become company secretary.

Vertu said its new car retail like-for-like volumes rose 18.6%, “achieving volume bonuses and new car margins above expectations”.

The group said its fleet sales were a significant part of its operations and volumes fell by 14% in like-for-like fleet and commercial vehicle sector.

Like-for-like used car volumes fell by 9% between September 2009 and January 2010.

January contributed 58.6% of the period’s overall fall in used car volumes since the month’s snow disrupted what is normally a very strong used car month for the group.

However, Vertu said demand had rebounded significantly in late January and February, although supply of quality used car stock is still constrained.

Aftersales activities such as servicing, body repairs and supply of parts remain a major element of Vertu’s operations and it said this part of the business had remained consistent on a like-for-like basis.

Vertu has added 14 sites to its portfolio since March 1, 2009 and is looking for more acquistions.

Outlook for 2010

Vertu said the remainder of 2010 looks uncertain, particularly in the new car sales market.

The ending of the scrappage programme, January’s rise in VAT, the introduction of the new car “showroom” tax in April and continued strength in the Euro against Sterling all indicate that new car sales to private customers will decline over the remainder of the year.

The group is hoping the fleet, used car and aftersales markets are likely to be more resilient in the coming period.

Vertu’s full preliminary results will be revealed on May 12.

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