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Third quarter trading was satisfactory, says Lookers

Lookers has reported a 2% year-on-year uplift in new car sales after quarter three trading, fuelled by growth in the fleet sector.

The national car dealer group said it has seen fleet volumes increase by 30%, however private new car sales have fallen 10%.

It said it continues to gain market share, and new car margins remain “satisfactory” and ahead of budget.

Overall it described its Q3 trading performance as “satisfactory” against the background of a tough market and uncertain general economic conditions.

It expects its full 2011 results to be in line with management expectations.

Used car volumes in Q3 were slightly ahead year-on-year and 4% up year-to-date, but profit margins have been eroded slightly due to weaker consumer demand.

Lookers said aftersales revenue and margins have remained in line with the prior year, despite the declining 0-3 year car parc.

“This demonstrates the success of our continued investment in technology and procedures to improve customer retention and average sales value per customer visit,” the top five AM100 company said.

Its independent parts division has performed in line with budget, Lookers added, and the group continues to manage working capital and improve cashflow.

The sale of surplus assets this year has raised £12.7m, and £21.8m of bank loans have been repaid.

It expects to end discussions with its banks this quarter to secure new banking facilities providing greater flexibility and a reduction in the interest rate margin that is paid on group borrowings.

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