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Benbar profits up 49%

Benbar - the Warrington based Toyota, Citroen and used car dealer group - has announced a 49% profit increase for the six months ending June.

Turnover is up 8% to £16.5m with net profit after interest increasing to 1.9% of turnover.

Company chairman Stephen Langley said: “Obviously, the first half of 2009 was difficult pre-scrappage so our results are somewhat flattered by that.

"However, aftersales performance this year has seen absorption rise to 113% which is encouraging and our onsite accident repair centre continues to exceed forecasts.”

Whilst used car performance has toughened in the last two months, there has been an increase in fleet business which is a good economic barometer.

“Such activity will assist in insulating us from any potential slowing in retail post scrappage compared to last year,” said Langley.

On the Toyota recall, Langley added: “Toyota has been tremendously supportive this year following the recall actions. Our staff, all credit to them, contacted 1,220 customers in eight weeks who in turn demonstrated their understanding and loyalty despite the media maelstrom.

"Toyota’s introduction of the five-year warranty – a first for a volume brand – has been very well received by existing and conquest customers alike.”

The appointment of new senior management at Citroen headed up by managing director Linda Jones is a “timely welcome” said Langley.

“Linda has extensive knowledge of the UK retail market and dealer network and alongside her team, will bring a common sense approach to the development of the Citroen brand and will restore the manufacturer’s profit potential through the excellent rationalised product range.”

 

With the VAT increase just a few months away, Langley added: “I cannot see a huge pull forward. The price inflation we have seen over the past 18 months and the strengthening of sterling against the euro will see any potential downturn mitigated by manufacturers’ increased support at transactional level.

"Although the rest of this year will be challenging, the group is generating strong cash flow and with the benefit of its low gearing, is well placed to improve further.”

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