3rd Mar 2014 11:45
LONDON (Alliance News) - Vertu Motors PLC said Monday it expects trading for the year to February 28, 2014, to beat current market expectations after benefiting from strong market conditions and a spate of successful acquisitions.
For the five month period to January 31, 2014, the firm records like-for-like volume and revenue growth, as well as an improving ratio of, "operating expenses to sales due to operational gearing benefits."
Vertu said like-for-like private new retail volumes grew by 21.5%, ahead of UK market growth of 14.8%; like-for-like new fleet and commercial vehicle volumes grew by 23.2%; like-for-like used vehicle volumes grew by 11.1%; and like-for-like aftersales revenues increased by 5.0% with growth in all channels.
The company noted that new retail car like-for-like order take for March is already ahead of last year, reflecting continued momentum in the retail market for new cars.
The firms' pipeline of acquisition opportunities remains strong, said Vertu, following the successful integration of the Albert Farnell Land Rover business in June 2013. The Group later won Land Rover Dealer Group of the Year 2013. During the year the firm grew the number of its sales outlets from 95 to 106.
During the reporting period, Vertu said favourable conditions within the UK motor retail sector have continues, with new car market continuing with double digit private new retail growth, attributed to an improving UK consumer environment creating demand and a weak car market in the Eurozone driving supply.
Looking ahead, the company said as the UK new car market remains positive, and while there is a risk that these trends may lead to pressure on new vehicle margins in the event of supply exceeding demand, a higher volume market normally benefits the Group in the short term through sales and in the medium term through higher aftersales volumes, it said, noting that March remains the most important month for the profitability of the UK automotive sector as a consequence of the registration plate change and its impact on both new vehicle demand and the seasonality of servicing.
Vertu plans to report its preliminary results for the year end February 28, 2014 on May 7, 2014.
Shares in the automotive up 1.4% at 64.9 pence per share Monday.
By Alice Attwood; [email protected]; @AliceAtAlliance
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