4th Mar 2015 09:32
LONDON (Alliance News) - Lookers PLC Wednesday reported another year of strong profit growth in 2014, as a continued boom in the UK car market continued to drive up its sales of new cars and servicing as well as its growing parts business, and it said it's confident of further growth in 2015.
The chain of car dealerships, which sells brands from car manufacturers including Volkswagen Group, Ford, General Motors, Fiat Chrysler, Honda, Kia and Nissan, as well as premium brands including Aston Martin, Bentley, Jaguar Land Rover and Ferrari, reported a pretax profit of GBP59.2 million for 2014, up from from GBP43.9 million in 2013, as revenue rose by almost a quarter to GBP3.04 billion from GBP2.46 billion.
Its pretax profit excluding amortisation, debt issue costs, pension costs and share-based payments rose 35% to GBP65.0 million, from GBP48.1 million, which the company said represents a sixth consecutive year of growth.
Lookers, which has 123 franchised dealerships, proposed a final dividend of 1.87 pence, bringing the total dividend for the year to 2.84p, up from 2.58p in 2013.
"The motor division has produced an excellent result and the parts division has made good progress, delivering a strong performance in improving but competitive market conditions. Lookers is well placed to take advantage of future growth in the new and used car markets as well as increased demand for aftersales and parts. This gives us further confidence that we can continue to grow the business in 2015," Chief Executive Andy Bruce said in a statement.
Pretax profit in the motor division rose 37% on the year to GBP58.3 million, from GBP42.6 million.
Lookers said new car sales volumes rose 9.7% in 2014, slightly ahead of the 9.3% increase in total UK new car registrations during the year, while gross profit per unit increased by 4.6% on new retail cars. Its used car sales volumes rose 4.4% on a like-for-like basis.
Revenue in the important area of aftersales increased by 5.3% on a like-for-like basis, as the increased number of new cars sold in the last three years returned to be serviced and repaired. The margin in the aftersales business rose to 42.5% from 42.7% on a like-for-like basis.
Revenue in its parts division rose 4% to GBP8.4 million and it continued to expand the business by investing in new product lines. Pretax profit in the unit rose to GBP12.2 million, from GBP11.8 million.
"The group has made a good start to the current financial year, we have a healthy order book for the delivery of new cars in the important month of March and aftersales continues to perform well. We therefore expect the result for the first quarter to be in line with expectations," it said in its outlook statement.
Still, Lookers shares were down 2.5% at 149.25 pence Wednesday morning, having increased 14.8% so far in 2015.
By Steve McGrath; [email protected]; @stevemcgrath1
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