15th Aug 2018 10:13
LONDON (Alliance News) - Lookers PLC on Wednesday said it looks forward with a degree of caution, despite a slight improvement in profit in the first-half of 2018.
The car dealer said pretax profit rose in the six months to the end of June to GBP45.7 million from the GBP44.6 million reported for the same period a year earlier, as revenue grew to GBP2.58 billion from GBP2.46 billion.
Adjusted pretax profit was GBP43.1 million, down from GBP50.2 million, as the recent figure excludes a gain of GBP7.6 million registered on the sale of a property a year before, the company said.
Lookers noted that the strong performance in the first half of 2017 was helped by an increased demand for diesel vehicles. However, this trend has declined since April last year. These factors resulted in an abnormal balance of profit, the company said, where 73% of its profit in 2017 was generated in the first-half of the year.
In the first half of 2018, Used Cars division delivered revenue of GBP996.0 million, up 12% compared to USD887.0 million a year earlier, due to a significant increase in the Lookers' used car volumes. The company said the UK used car market continues to be buoyant and values of used cars have remained stable and predictable.
The Aftersales unit also performed well during the period, with revenue rising by 6% to GBP228 million from USD215 million a year before, due to the slightly higher margin and volumes. Lookers said the increase in volumes and margin was helped by the unit reorganisation, which focused on increasing capacity and customer retention.
The New Cars segment ended the period flat, with revenue standing at GBP1.31 billion, while revenue in the leasing division decreased by 7% to GBP41.0 million from GBP44.0 million.
Lookers declared an interim dividend of 1.48 pence per share, up 5.0% from 1.41p paid the prior year.
Looking forward, Lookers said the current political environment, Brexit, and weaker exchange rates create a degree of uncertainty in the UK economy, which is unhelpful.
"I am pleased with our performance over the first half of the year, which has been delivered despite ongoing challenging market conditions," said Chief Executive Andy Bruce.
"We expect a more balanced distribution of profits between the first and second-half of this year and as such anticipate a positive profit performance in the second half of the year compared to the same period last year," added Bruce.
Shares in Lookers were trading 0.8% higher on Wednesday morning at 105.87 pence each.
Related Shares:
LOOK.L