27th May 2016 07:36
LONDON (Alliance News) - Caffyns PLC on Friday reported a drop in profit in its recently-ended financial year as an exceptional gain it received the prior year was not repeated, but profit rose on an underlying basis, boosted by growth in revenue.
The car dealer said its pretax profit in the year ended March 31 dropped to GBP2.6 million from GBP11.4 million the year before, despite revenue growing to GBP232.5 million from GBP210.3 million.
Profit was hit as Caffyns faced a cost for the redemption of 425,000 preference shares, but also because the prior year benefited from an non-repeated gain of GBP8.9 million on the past service cost of the defined benefit pension liabilities.
On an underlying basis, which excludes exceptional costs and gains, pretax profit grew to GBP2.9 million from GBP2.5 million.
Meanwhile, revenue was boosted by a 6.2% rise in like-for-like new car unit sales and a 9.3% rise in like-for-like used car unit sales, while like-for-like service sales rose by 6.5%.
Caffyns will pay a total dividend of 21.75 pence for the year, compared with 20.25p the year before.
"Economic growth in the UK has slowed but manufacturers continue to support our market with strong finance led offers, particularly on new car personal contract plans as well as, increasingly, on used car plans," Chief Executive Simon Caffyn said in a statement.
"We are well placed for organic growth having recently opened our refurbished Volkswagen dealership in Eastbourne and completed the upgrading of other key dealerships. The proceeds from the Land Rover sale further strengthens our balance sheet and provides the company with significant financial flexibility to take advantage of opportunities to expand," he added.
Caffyns sold its Land Rover business in Lewes for GBP7.5 million in April.
Shares in Caffyns were trading up 1.8% at 580.00 pence on Friday morning.
By Karolina Kaminska; [email protected] @KarolinaAllNews
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