AM Online

Group 1 Automotive boosts profits by 48% in 2013

US-owned Group 1 Automotive saw gross profits increase by 48% to $93.2 million (£57.2m) at its UK operation in 2013.

These latest figures relate to the UK contribution to Group 1's US results.

The dealer group said its UK performance was boosted by its acquisition activity, which boosted turnover by 55.3% to $810.8 million (£498m).

Revenue growth was primarily driven by 70.9% and 80.1% increases in new and used vehicle retail unit sales, to 13,699 units and 16,844 units respectively.

The unaudited full year results to December 2013 show Group 1’s gross margin on new car retail sales fell slightly from 7.7% to 6.4% with gross profit per unit sold falling slightly from $2,742 (£1,683) to $2,076 (£1,274). Gross profit per unit on used fell slightly from  $891 (£547) to $807 (£496).

The average retail sales price on new cars was $32,231 (£19,792) and the average retail sales price on used was $24,326 (£14,938).

Houston-based Group 1 was the second US dealer group to become established in the UK when it bought Chandlers Garage in 2007, giving it a network of BMW and Mini dealerships in the South East.

Group 1, which has more than 100 dealerships in the US and Brazil, followed Roger Penske’s United Auto Group into the UK after UAG bought Sytner in 2002.

From the outset, Group 1 chief Earl Hesterberg said he would grow the company through acquisitions. Fifty dealerships, he said in 2008, would be a “nice-sized business”.

Acquisition activity was superseded by the recession and cost-cutting in 2008 and 2009, however, which included pay cuts for directors as the company sought to save $100m (£69m).

Then in 2010, Group 1 bought Barons, expanding its BMW/ Mini representation with two sites in Farnborough and Hindhead.

In 2012, it bought six-site Audi business Hodgson Automotive, trading as Essex Audi.

In 2013, it added Inchcape’s four Ford dealerships in Farnborough, Guildford, Wokingham and Bracknell.

Group 1 is led by former Chris Hayden in the UK following his appointment in May 2013.

Read AM’s in depth interview on what dealers can learn from the US following Hayden’s time leading Group 1’s Californian operations before his move to the UK.

> Group 1 Automotive is a subsidiary of the US corporation Group 1 Inc. The UK subsidiary filed its 2012 UK accounts in September 2013.



If you are not a registered user your comment will go to AM for approval before publishing. To avoid this requirement please register or login.

Login to comment

Comments

No comments have been made yet.