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Peter Vardy delivers profit in Q1 with used car sales boost

Peter Vardy Limited (PVL) has reported first quarter profits of £2.2 million following a year of restructuring the business.

The group attributed its performance to a rise in used car sales - already having achieved 168% of this year’s business target - and strong growth in its servicing and parts business.

The group is achieving 3.6% return on sales, which is above the current industry average of between 0.5% and 1%.

Peter Vardy, the group’s chief executive, said: “Used car sales have really taken off, mainly on the back of our increased efforts to source quality, value-for-money stock.

“I’m also delighted to see a major rise in service and parts revenues despite this being an area which is predominantly in decline across the motor trade. I feel our success here has come on the back of a real commitment to customer service and an investment in training.”

Vardy said that in addition to the Q1 profit, the business has enhanced the working capital within the group and improved its debt position following its 2010 acquisitions which are now “bedding down”.

He added: “We are also seeing reward for our efforts to offer a quality approach to car retailing with a 3.6% return on sales which, within our industry, is a very impressive result.

“While we have a ways to go, I’m really delighted with the start we’ve made to 2012 and pleased to see that sales continue to go well into this current quarter.”

PVL’s Edinburgh-based BMW and Mini dealerships are currently number one in the UK for new car sales and have achieved 208% of this year’s target.

The dealer group acquired Vauxhall dealerships in Edinburgh and Aberdeen in 2010 and now has seven dealerships with a turnover of £207.9m which generated an operating profit of £2.1m in its 2011 financial year.

After experiencing a “difficult marketplace” in the early part of the year, the company reported “very strong” trading for both sales and aftersales in the latter six months.

PVL also repaid £16.5m of loans during the 2011 financial year.

PVL was launched in June 2006 and now has seven new and used car dealerships in Edinburgh, Perth, Kirkcaldy, Aberdeen and Motherwell with four franchises including BMW, Mini, Vauxhall and Chevrolet.

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