Lookers Lifts Dividend Despite Profit Drop Due To Rising Costs

7th Mar 2018 10:23

LONDON (Alliance News) - Lookers PLC on Wednesday raised its dividend for 2017 by 7%, despite a drop in profit amid revenue growth.

The UK motor retail and aftersales service group reported a pretax profit of GBP58.4 million, down 27% from GBP79.6 million, coming from a drop in profit from operations to GBP77.4 million from GBP101.3 million amid a rise in administration and distribution costs.

Revenue for 2017 grew 15% to GBP4.70 billion from GBP4.09 billion, with growth in new and used sales.

New car turnover was up 12%, and 3.0% on a like-for-like basis, despite a reduction in overall market volumes, and used car turnover was up 19% and 13% on a like-for-like basis against strong comparatives.

The group declared a final dividend of 2.48 pence per share, up 5.0% from 2.36p the year before, bringing the total payout to 3.89p, up 7.0% from 3.64p.

Lookers said its results for the first quarter of 2018 and its order book for new cars in March is set to be in line with management expectations, with used car volumes continuing to show growth alongside momentum in aftersales.

"We have delivered a robust set of results with good growth across all areas of the business, demonstrating the resilience and differentiation provided by the Lookers business model. Against a backdrop of a 5.6% dip in the new car market, we have seen strong momentum in used cars and aftersales," said Chief Executive Andy Bruce.

"We have made good progress with our strategy over the year and remain focused on having the right brands in the right locations, combined with excellent execution that gives our customers a personal, relevant and multi-channel retail experience. We have managed our portfolio of dealerships to reflect this goal and our franchise representation is well positioned for the future," Bruce added.

Shares in Lookers were up 1.8% at 95.00 pence on Wednesday.

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