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Pinewood eyes growing in "fragmented" dealer software market

2nd Oct 2024 11:00

(Alliance News) - Pinewood Technologies Group PLC on Wednesday reported "double-digit growth" in the first half of its financial year, and said it is on track to meet annual expectations.

The provider of software firm to the automotive retail sector said pretax profit in the six months to July 31 amounted to GBP7.0 million, on revenue of GBP16.1 million.

That would represent a 52% profit rise from the GBP4.6 million reported for the first six months of 2023, the period Pinewood used as a comparison. Revenue for the half-year was 46% higher than GBP11.0 million in the first six months of 2023.

Underlying pretax profit, however, fell 13% to GBP4.0 million from GBP4.6 million. Pinewood reported net finance income of GBP4.3 million, excluded from the underlying profit calculation.

Gross profit rose 48% to GBP14.5 million from GBP9.8 million. The figure includes cost of sales but excludes operating expenses.

The prior figures are for continuing operations only. Pinewood had achieved overall revenue of GBP2.09 billion in the first half of 2023.

During the previous year the company, then named Pendragon, conducted a comprehensive strategic review which lead to the sale of its Motor & Leasing division to Lithia Motors Inc. The company changed its name in February, shortly after the near GBP400 million deal with Lithia was sealed.

"Pinewood had a great first half of the year, with impressive double-digit growth in both revenue and gross profit, and we have also made good progress in expanding our customer base," Chief Executive Officer Bill Berman said.

"The global market for dealer management software is fragmented and we believe we are well placed to grow our business in our key markets of the UK, Northern Europe, Asia Pacific and North America - where our position is strengthened by our partnership with Lithia, the largest dealer group in North America."

The firm expects underlying pretax profit in line with current market expectations. According to company-compiled consensus, it is expected to report underlying pretax profit of GBP7.8 million. The full-year period is for the 11 months to December 31. Its current accounting period began on February 1, around the time it sold its former Motor & Leasing arm. The following financial year will be the 12 months to December 31, 2025.

Pinewood shares fell 9.3% to 327.09 pence each in London on Wednesday morning.

By Eric Cunha, Alliance News news editor

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Copyright 2024 Alliance News Ltd. All Rights Reserved.

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