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John Clark Motor Group reports 5% rise in turnover for 2016

John Clark

The John Clark Motor Group will grow through the post-Brexit period despite a “ongoing political uncertainty” and a “stable but fragile economy”, according to a statement made following the publication of its 2016 financial results.

The Aberdeen-based AM100 group’s chairman, John Clark, said that midyear management accounts for 2017 showed 7% growth in turnover and net profits for the group and targeted further growth following a set of 2016 results which showed a 5% growth in turnover but declining profitability.

Commenting on the group’s prospects, Clark said: “We retain a strong and supportive relationship with our funding partners and our finances are in good shape, to allow us to not just face up to the added uncertainty of post Brexit Britain but to grow through it and again pursue further opportunities.”

During the year ended December 31, 2016, John Clark Motor Group saw its turnover grow 5% to £703m (2016: £667m) as profit before tax declined - for a third consecutive year - by 9.5% to £8.25m (2015: £9.11).

Slimmer profits were recorded despite used vehicle volumes reaching record highs during 2016.

New unit sales volumes rose by 4% to 14,712 units and used volume grew by 10% to 13,062, the group reported – results which outperformed a 0.2% growth across the Scottish market.

Clark said: “The Group’s primary aim in 2016 was to see consolidated growth from expansion in prior years and, despite the continued downturn in the North Sea Oil Industry and resultant impact on the Grampian Region, to maintain positive momentum towards our key strategic objectives.

“We continued to focus on developing and extending the relationships with our existing franchise partners in the North, East and central belt of Scotland. As well as to consider potential opportunities which were presented to us by others and lead us to open Peugeot, Renault and Dacia in Aberdeen.

“Whilst the early months saw encouraging trading results, the period leading up to and after the Brexit Referendum saw a marked reduction in our vehicle sales performance. 

“Consequently, some dealerships experienced operating profits under pressure, against a background of challenges caused by changing market dynamics and declining consumer confidence.

“Therefore, it is pleasing to again report record turnover, with new and especially used vehicle sales growth that saw our market share improve again.  Our customer base has never been bigger and our aftersales operations continue to get stronger.”

John Clark Motor Group grew its staff headcount by 6% to 1,206 from 1,139, which can be attributed to the new Renault, Dacia and Peugeot franchises, as well as some increases in head office staff, required to support business growth.

Group managing director, Chris Clark, said: “Throughout 2016 our investment activities saw significant sustained spend on staff training including our in-house management development, apprenticeship and trainee programmes.

“I was therefore delighted in January 2016 to see the group named as winners of Best Training and Development Programme at the annual Automotive Management Awards. Placing us ahead of some of our dealer group peers and some of the leading manufacturer franchise training departments.”

John Clark Motor Group also made investment in property during 2016, with the completion of its Dundee Audi and Volkswagen Aberdeen showroom refurbishments. 

The focus on property will continue in 2017, the group said, with the opening of an all-new Pentland Jaguar Land Rover dealership at Fort Kinnaird in October, which is designed to service customers that live East of Edinburgh City.

Work has also begun on the relocation of John Clark BMW, Mini and Motorrad in Dundee, as well as a brand new Jaguar and Land Rover dealership.

 

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