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Car dealer Cambria Automobiles reports 64% interim half year profit rise

Cambria Automobiles

Cambria Automobiles has this morning reported a rise in turnover of 18.6% and profit before tax of 63.8% for the six months to February 28.

PBT is at £3.3 million on turnover of £242.8 million, with a profit margin of 1.36% - up 39% from 0.98% in the same period last year.

Mark Lavery, chief executive, said: “Cambria continues to develop its existing business and to deliver further growth through acquisitions.

“The acquisition of the Jaguar Land Rover business in Barnet in July 2014 followed by the acquisition of our second Land Rover business located in Swindon on April 30, align with the strategy we laid out in 2013; namely to invest in premium and luxury franchises that fit with our geographical locations and deliver immediate earnings enhancement.

“The board continues to focus on opportunities to strengthen the group’s position in luxury and premium brands and is actively pursuing acquisition opportunities which have the potential to fulfil these ambitions.

“The group’s performance in the all-important month of March was both ahead of our business plan and the previous year. The board is confident that Cambria will maintain this momentum and continue to deliver an improved performance across all of its activities.”

Last week Cambria bought a Land Rover dealership in Royal Wotton Basset from TH White for £7.56m.

New vehicle revenue increased by 31% tp £109.4m (H1 2014: £83.5m) with total new vehicle sales up 15.6%. The new vehicle gross profit margin was 6.6% (H1 2014: 6.7%) and there was a £1.6m increase in gross profit. On a like-for-like basis, excluding the Barnet acquisition, new volumes rose by 8.8%.

“This performance was delivered against a backdrop of an 8.2% year-on-year increase in new car registrations in the UK for the period September 1, 2014 to February 28, 2015,” Cambria’s interim report states.

“The private registrations element of the new car market increased 6% year-on-year. The group’s brand partners saw a combined 8.1% increase in their total registrations during the course of the period.

“The group’s sale of new vehicles to private individuals was 12.7% higher year-on-year at 4,585 units, supported by strong consumer offers from the manufacturers.

New commercial vehicle sales increased by 35.2% to 511 units whilst new fleet vehicle sales increased by 36.4% to 266 units. Increased growth in these two areas is expected to continue.”  

Used vehicle sales were up from 6,906 to 7,106 (2.9%). Revenues increased by 11.2% to £109.6m (H1 2014: £98.6m) and the number of units sold rose by 2.9%.

The gross profit on used vehicles increased by 11.2% to £9.9m (H1 2014: £8.9m), with the profit per unit sold increasing by 8.3%. Excluding the impact of Barnet, Cambria’s used volumes remained static at 6,905 units but profit per unit increased by 7.7%.

Service hours sold was 162,420 compared to 155,608 last year, up 4.4%.

Aftersales revenue increased 6.2% year on year to £29m (H1 2014: £27.3m), and the related gross profit increased to £12.4m (H1 2014: £11.6m). Excluding the impact of Barnet, service hours were in line with the previous year. The total aftersales margin increased from 42.4% to 42.8%. The aftersales departments contributed 42% of the group’s overall gross profit.

 

Outlook

Low interest rates and a favourable exchange rate against the Euro will allow manufacturers to continue to offer strong financial incentives to buy new cars, Cambria says. It expects new car volumes to remain “robust”.

The group’s strategy, outlined in 2013, to invest in premium and luxury franchises that fit with existing geographical locations and deliver “immediate earnings enhancement” stays in place with the group “actively pursuing acquisition opportunities which have the potential to fulfil these ambitions”.

> For more analysis on Cambria's results and the biggest dealer groups in the UK, come to the AM100 Dinner on June 11 to see the official unveiling of the AM100 listing ahead of publication in AM. It’s also a great opportunity to network with those retailers. More details at www.am100dinner.co.uk

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