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Lookers Q1 trading outperforms the market

Lookers has seen its new car retail sales drop by 10.5% in the first quarter of 2011 compared to Q1 2010.

That performance was ahead of the nationwide 18% reduction in retail demand.

The motor retail group, ranked 5th in the AM100, said that shows it is gaining market share and new car margins remain satisfactory and ahead of budget.

Lookers’ used car volumes increased 6% in Q1 2011 with satisfactory margins consistent with last year.

Aftersales has remained flat, however gross profit margins have improved.

Its parts distribution division, which serves the independent aftermarket, has made further improvements, with profitability ahead of both budget and last year.

Peter Jones

Peter Jones, chief executive (pictured), said: "Although market conditions remain challenging, we are very pleased with the excellent start to the year. Both the motor and parts divisions have produced strong trading results in the period which gives us confidence that we will continue to trade successfully this year and be in a position to take advantage of growth opportunities should they arise."

Lookers has continued to rebalance its franchise portfolio in Q1, selling or closing four underperforming businesses and adding two new businesses.

Looking ahead, Jones said the new and used car markets continue to be affected by consumer confidence and could be subject to possible supply issues, however the aftersales bias to Lookers, combined with its strong performance over the last two years, demonstrates the strength of the group's business and its ability to perform well in a difficult market.

The group balance sheet has been strengthened significantly over the past two years and this, together with substantial headroom in its bank facilities enables Lookers to continue to look at further strategic acquisition opportunities as they arise.


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