The new boss of Inchcape says the company is in a strong position to capitalise on favourable market conditions in the UK - and acknowledged tougher trading in used cars - in a trading update today.
Commenting on the state of trading from the start of the year to May 20 group chief executive Stefan Bomhard (pictured) said: “I have been part of the group for nearly two months and I am excited about the potential for Inchcape and all our stakeholders.
“I look forward to continuing Inchcape’s success, driving sustainable value creation for our shareholders, progressing the group’s strong relationships with leading brand partners and fostering our customer-focused performance culture.
“The group's high quality distribution and retail businesses are well positioned in the most attractive segments of a global growth industry. Coupled with our operational rigour focused on driving performance and unique local growth drivers, the first four months of 2015 have seen positive trading momentum in line with our expectations.”
In the UK, he said revenue growth had been strong, “with our brand portfolio continuing the long-term trend of winning market share”.
“Year-on-year margins improved in new vehicles but there was pressure in used vehicles,” he said. Aftersales’ activities “also performed well”.
Across all its global operations, group revenue was £2.191 billion, up by 4.1% at constant currency (0.9% below last year at actual currency). Like for like revenue was up by 4.9% at constant currency (0.3% below last year at actual currency).
Demand for vehicles was “solid” and ahead of last year.
Aftersales’ activities, accounting for about 50% of the group's gross profit, performed “well and in-line with expectations, “driven by the new car growth of recent years resulting in a growing one-five year car parc in the majority of its markets.
“Our partnerships with the world's leading OEMs and our balance sheet strength position us to seize attractive opportunities, make disciplined capital investment in high margin and high growth markets and continue with our previously announced £100m share buyback programme,” said Bomhard.
“We continue to expect the Group to deliver a robust underlying constant currency performance in 2015. Notwithstanding the competitive pressure on vehicle margins in some of our markets, we are well positioned to take advantage of the attractive growth prospects in the premium and luxury segments across our markets.”
Inchcape plc also announced this morning that Nigel Northridge, who was appointed as a non-executive director of the company in July 2009, has been appointed as the senior independent director with immediate effect.