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Cambria highlights 'cast iron balance sheet' in annual results

Mark Lavery, Cambria Automobiles chief executive

Cambria Automobiles chief executive Mark Lavery has highlighted the group's “cast iron balance sheet” after reporting a 4.9% rise in revenues and underlying profit before tax up 6.6% in its full-year financial results to August 31.

Despite new vehicle sales volumes down 11.7% at 11,052 (2016: 12,516) and used vehicle sales down 6.1% to 14,765 (2016: 15,729) following the closure of its Swindon Motor Park, chief executive Mark Lavery said that the top AM100 business enters 2017 in a strong position.

Lavery pointed out the Swindon-based group’s net assets of £50.4m (2015/16: £42.1m), strong operational cash flows, with a cash position of £23m (2015/16: £19.8m), net cash of £6.1m (2015/16: net cash £0.4m) after significant investment in property during year.

The set of annual results also detailed the group’s refinancing of its existing debt facilities to provide a new £40 million via a five-year revolving credit facility agreed with Lloyds Banking Group this month.

Lavery said: “There’s no doubt that we are in a period of great uncertainty but with the cash we have available we are well placed to embrace the opportunities that will bring.

“Some people might feel that we have been conservative in our approach to investments but I feel that is now paying dividends. We’ve invested in a freehold property portfolio which has left us with £45 to £50 million worth of assets and we have committed to a further £29 million investment in that direction.

“Controlling our property costs will put us on a strong footing.”

Cambria generated £1.95 million from the sale of a Jaguar Croydon to Harwoods, meaning that its 2016/17 results were affected by the non-recurring income.

Revenues rose by 4.9% to £644.3 million (2016: £614.2 million) and on an underlying basis EBITDA rose by 4.6% to £13.7 million as operating profit increased by 5.8% to £11.8 million and profit before tax was up 6.6% to £11.3 million.

Cambria reported that the impact of declining new car sales had been offset by a 25.7% increase in profit per unit while used vehicle sales down 6.1% were offset by a 5.6% improvement in profit per unit.

The group’s aftersales revenues also rose by 9% to £71.4 million (2016: £65.5 million).

Cambria celebrated its 11th anniversary in July and its growth from a single site with three new car franchises to 31 locations representing 46 new car franchises and 16 different brand partners.

During the accounting period to the end of August the group implemented the successful addition of two major high luxury segment brand partners with the opening of Aston Martin Solihull and the completion of its JLR Arch Concept faciltiy in Barnet and will follow that up with the planned opening JLR, Aston Martin and McLaren franchises in Hatfield in January 2018.

The group will also open two Bentley dealerships in January – its first with the brand – and complete work on its re-development of the Swindon Motor Park location to provide a new JLR facility in line with the new Arch design concept for JLR facilities.

Lavery said that the brand was not unduly preoccupied with premium and luxury brands, however. Despite closing its only Seat franchise, in Swindon, during the financial year, he said: “We would never say that we won’t invest in more volume brands. Anything’s a possibility."

Lavery conceded that, post the period end, trading in September and October had been in-line with the board’s expectations, but behind the prior year as a result of the weaker new car market.

But he said that the strong balance sheet had ensiured that “We’re open to opportunity moving into the new year.”

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