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Lookers reports ‘continued strong momentum’ in AGM trading update

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Lookers has reported growing turnover and profitability across new and used car sales and its aftersales operations in a trading update announced at its AGM today.

The AM100 franchised car retail group’s chairman, Phil White, will deliver a positive message of ‘continued strong momentum’ today after Q1 financial results revealed growth across the group's operations during the first three months of 2019.

Two months after the publication of a set of 2018 annual financial results which revealed the group had delivered a 9% decline in pre-tax profits despite growth in aftersales and used cars, today's trading update published today said: “The Group has delivered a positive performance over the first quarter with continued strong momentum in both our used car and aftersales businesses, demonstrating the resilience and diversity of the Group's business model, despite the continued political uncertainty."

The group’s latest results reflect a positive start to 2019, although conditions following the end of March’s key ‘plate change month were described as “satisfactory”.

Although turnover and profitability from new cars were maintained on a like-for-like basis during the three month period to March 31, the group reported increases of 3% and 4%, respectively, alongside what it called “a modest increase in profit per unit”.

Used car sales, which make up 25% of Lookers’ total gross profit, delivered an 8% increase in turnover as gross profit rose 2% as profit per unit was maintained at previous levels.

On a like-for like-basis, turnover from used cars increased by 6% and gross profit increased by 1%, Lookers said.

In aftersales – which represents 39% of Lookers’ total gross profit – turnover increased 11% as gross profit increased by 9% at a slightly lower margin.

On a like-for-like basis, turnover increased by 9% and gross profit increased by 6%.

Back in March, the AM100’s third-placed retail group (2018 rankings) revealed that it had generated a 4% increase in turnover to £4.88bn during the period to December 31, 2018, as profit before tax declined to £53.1m from £58.4m the previous year.

Today's trading statement, issued by the London Stock Exchange this morning (May 31), said: “We have a strong balance sheet, giving us the capacity to consider selective strategic acquisition opportunities and to continue to invest in upgrading our facilities and enhance our multichannel customer capabilities.

“The financial performance of the group in the period demonstrates the effectiveness of our strategy of having the right brands in the right locations and the trading performance since March has been satisfactory in the light of current trading conditions.”

 

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