Pendragon achieved double-digit percentile growth in sales in 2010 and enjoyed an uplift in operating profit as the UK’s largest motor retailer continues to regain its strength.
The group grew revenue to £3.575 billion (2009: £3.191 billion) while increasing the underlying operating margin to 2.1% (2009: 1.7%) and lifting operating profit to £63.2 million (2009: £56.7m).
However net borrowings have increased slightly to £325.5m (2009: £315.4m).
Trevor Finn, chief executive, said the business has made “considerable strides” in the last year.
He added: “We have benefited from our scale as the largest car retailer in the UK combined with our success in driving performance through our operational initiatives.
“The results of our used car operations have been particularly pleasing with outperformance against the market.
"We continue to make progress in our aftersales segment despite a reduced vehicle parc in some of our key franchises.
"New car operations performed strongly due to the franchise mix we hold and our continued improvements in this sector.
“While the group performed well in 2010, what's more pleasing is to see that momentum carried forward into January, and we look forward to it continuing during 2011."
Expanding with car supermarkets
Finn said the group has right-sized the business and is well positioned for 2011 with a refined portfolio of franchises.
He plans to continue to review individual franchise points from a strategic and cost perspective, although says the existing poerfolio has further capacity for growth in 2011.
Another objective is to grow Pendragon’s used car business, both in the franchised operations and through new supermarket start-ups under the Quicks brand.
Pendragon already has four Quicks sites up and running, and plans three more in 2011.
On the increased debt, Finn said this is higher than planned due to two main factors - the realignment of target used car stock levels and the increase in stocks of new vehicles held to satisfy orders for vehicles prior to the VAT rate increase immediately after the year end.