30th Apr 2014 12:32
LONDON (Alliance News) - Automotive retailer Pendragon PLC Wednesday said that improved profitability continued into the first quarter of its new financial year, and expects its underlying profit to be comfortably ahead of expectations for the year ahead, as it benefits from the continued strength of the UK used-car market.
In a trading update, Pendragon said the strength seen last year in sales of new and used cars, as well as after-sales servicing, continued into its new financial year, while the used-vehicle sector delivered a 19% increase improvement in like-for-like gross profitability, as well as contributing to nearly half of the gross profit improvement of the group in the period.
"The highlight of the quarter is our market leading internet position in the used-vehicle sector, as we achieved a 19th successive quarter of growth in used volume, coupled with an increase in margin," said Chief Executive Trevor Finn in a statement.
Pengdragon said that after-sales servicing, where it makes a large amount of its money, increased its profit by 6% in the quarter on a like-for-like basis, supported by a continued upward market trend.
The seller of car brands including Ford and Vauxhall through to premium brands like Maserati and Mercedes-Benz said it grew its gross profit by 12% in the period, and benefited from operating leverage with operating profit growing by 31%. However, it said that trading comparators will become tougher during the remainder of the year.
Pendragon said online visitors to its Evanshalshaw.com, Stratstone.com and Quicks.co.uk sites grew by more than 16% in the first quarter. It said it expects to have 15 million website visitors by the year end, which will be more than double that recorded in 2010.
"Given the significant progress, we expect that we will be comfortably ahead of expectations for 2014," the company said in a statement.
Pendragon shares were up 10% to 31.45 pence per share Wednesday afternoon.
By Rowena Harris-Doughty; [email protected]; @rharrisdoughty
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