National car dealer group Lookers has issued an interim management statement that describes its third quarter trading as a record result.
Lookers said the company produced an excellent trading performance in the third quarter to 30 September 2013, in particular during the critical month of September and the board is very pleased to yet again report a record result for the period.
These strong results were both ahead of budget and a significant improvement on the equivalent period in the prior year, it said.
The UK new car market increased by 11% in the nine months to 30 September, with the retail new car market increasing by 17% and the fleet market increasing by 6%.
Against this background Lookers' motor division delivered another strong performance, gaining market share with group core retail new car sales 19% higher than the previous year, 2% ahead of the market, with an increase in margin compared to the prior year.
Fleet volumes reduced by 6%, as it continued to improve the quality of its fleet business and avoid low profit transactions, however, fleet margins also increased, more than offsetting the reduction in gross profit from the lower fleet sales volumes.
Used car volumes for the nine months increased by 20% compared to last year, and used car margins also increased. Lookers said: "This very positive performance is against the background of a relatively flat used car market and reflects our strong focus on used car pricing, stock management and continuing increase in sales opportunities being generated by the group website, Lookers.co.uk."
The aftersales business in the motor division increased turnover and margin compared to last year.
The car dealer group added: "This is a positive result which demonstrates the benefits from our continuing initiatives in using electronic vehicle health checks which offer an improved and broader service to our customers whilst also increasing customer spend per visit.
"It is also a reflection of our continued focus on increasing customer retention through the sale of service plans, where customers commit to longer term contracts for vehicle servicing. We have also continued to pursue our commitment to enhance customer service and our "customers for life" strategy which will deliver further improvements in customer retention, to strengthen the business and further improve profitability."
Lookers' parts division has returned to growth this year with both turnover and profits increasing compared to the prior year, against a background of an improving yet competitive market. Turnover increased by 5% compared to the prior year as a result of continued investment in existing and new product lines. Whilst the increased volume was accompanied by a modest reduction in margin, strong control of overheads resulted in an increase in profit before tax ahead of the growth in turnover.
Lookers concluded: "The excellent performance of the group in the ten month period represents a further significant improvement in the financial performance of the company, which builds on what was already a strong performance in the previous year.
"This, together with the broad base of our franchise representation, the aftersales bias to the business and further recovery in the UK new car market, provide a positive environment for further growth.
"We are therefore confident that the results for the financial year to 31 December 2013 will be significantly ahead of current market expectations, providing an excellent base to continue to grow the business in 2014."