8th Oct 2019 09:52
(Alliance News) - Vehicle retailer Motorpoint Group PLC said Tuesday it expects interim revenue growth to outperform the market and proposed a GBP10 million share buyback due to strong cash generation.
For the six months ended September 30, revenue growth is expected to be 1% on the GBP528.6 million reported the year prior. The firm believes this to be a "significant outperformance" of the nearly new car market in the UK, and therefore should represent a "material" increase in market share.
The firm also believes that gross margins for the first half of the year should be "broadly in line" with the 7.7% reported the year prior. This was after the "well-documented" pressure on car margins in the early summer months had since abated.
Overhead costs, meanwhile, are expected to have risen by around GBP2 million on the year prior, though half of this was due to exceptional items.
"The board continues to closely monitor consumer confidence in light of the ongoing economic and political uncertainty," Motorpoint said in a statement.
"The board remains confident that the group's recent trading performance and strong current stock profile leaves Motorpoint well placed to continue to increase market share while management evaluate further potential new site opportunities," the firm added. "As a result, the board remains comfortable with its full-year expectations."
In a separate announcement, Motorpoint launched a share buyback programme for up to GBP10 million amid "continuing strong cash generation" at the firm. Motorpoint explained it still had shareholder authority to repurchase up to 6.2 million shares.
Shares in Motorpoint were 2.1% higher at 221.45 pence in London on Tuesday, giving it a market capitalisation of GBP202 million.
By Ahren Lester; [email protected]
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