Inchcape has revealed that it expects to “continue to benefit from its global diversification and scale” in a trading update which revealed group revenues had risen 14.6% to £2.3 billion in Q3.
Coming within days of Pendragon’s profit warning, which revealed that the top AM100 expected its underlying profit before tax for 2017 to fall over 20%, from £75.4m in 2016 to £60m by the end of the year, Inchcape Group chief executive Stefan Bomhard said: “I am pleased with our strong third quarter”.
Inchcape’s trading update covering the period from July 1 to September 30 revealed that group had achieved revenues of £2.3bn in the period, increasing +14.6% at actual currency and +11.3% at constant currency
The business’ vehicle distribution revenues rose 21.4% at constant currency with retail revenue +3.6% at constant currency, it said, which was “in-line with expectations”.
Bomhard said: "The strength of these results demonstrates the advantages of our global diversification and distribution-focused business model.
“With distribution the core part of our business and the structurally attractive emerging markets growing in the mix, the group has been able to deliver a strong revenue performance over the quarter despite continued margin pressures in some retail markets.
“Within our distribution business Singapore in particular was a good performer, driven by strength in commercial vehicles, and growth was further boosted by the contribution from our South America acquisition.”
In Europe Inchcape’s revenue growth was behind other areas of the business during Q3, however, growing by just 1.3%.
The trading update acknowledged that the UK market was slowing, “as expected”, resulting in continuing margin pressure on vehicles.
Strong growth in Eastern Europe, supported by the Estonia BMW acquisition, and Greece had been experienced, however.
Bomhard added: “Our focus on the Ignite strategy continues to deliver benefits across the group.
“I am encouraged with the progress we have made to date across all five strategic elements, with momentum continuing to build as demonstrated at our first half results.
“During the third quarter we were honoured to celebrate our 50-year anniversary with Toyota, a milestone supported by our Ignite objective of becoming the Partner of Choice for our OEMs.”
“Overall, I am excited about the long-term growth potential of Inchcape.
“With a high quality global footprint and leading OEM partners, supported by our Ignite strategic objectives, we believe that we can further leverage both organic and inorganic opportunities to deliver continued momentum.”