Auto Trader profit rises, but short-term outlook remains uncertain

Thu, 25th Jun 2020

Digital automotive marketplace Auto Trader reported an uptick in profit but said the short-term outlook remained uncertain despite an initial bounce back in used car demand since its retailers resumed operations. Since 1 June, when retailers were able to re-open their showrooms, both visitors and enquiries had 'rebounded strongly and are now at record levels,' the company said. The company said, however, that it had been seeing a 'higher than average pipeline of customers exercising their 30-day notice period to leave the platform,' but had not yet translated into increased levels of cancellations. For the year ended 31 March 2020, pre-tax profit increased by 4% to £251.5m on-year as revenue rose 4% to £368.9m. Retailer revenue, supported by growth in consumer services through both private and motoring services., was the main driver of growth, though this was 'slightly offset' by a decrease in manufacturer and agency & home trader, the company said. The prior year included a one-off £8.7 million profit recognised on disposal of Smart Buying to our joint venture, Dealer Auction As anticipated, no final dividend was proposed given the current uncertainties surrounding the Covid-19 pandemic, taking the total dividend for the year to 2.4p a share, down from 6.7p last year. 'We've been encouraged by the strong initial bounce back in used car demand, and whilst the short-term outlook remains uncertain, we believe the case for moving more of the car buying process online is stronger than ever,' the company said. Story provided by StockMarketWire.com

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