3rd Jun 2020 12:23
(Alliance News) - Vertu Motors PLC on Wednesday reported a sharp deterioration in profit for financial 2020 as it decided against declaring a final dividend payout.
Shares in the car dealer were trading 0.2% higher at 30.05 pence each on Wednesday in London.
For its financial year ended February 29, Vertu Motors posted revenue of GBP3.10 billion, up 4.0% from GBP2.98 billion reported for financial 2019.
However, pretax profit crashed to GBP7.3 million from GBP25.3 million, with a GBP14.4 million impairment charge "reflecting revised forecasts in light of the impact of Covid-19 on anticipated future cash flows". It added that the charge predominantly owed to goodwill relating to its Mercedes-Benz operations, and a freehold property operating its Vauxhall franchise.
While vehicle sales demand in the the first two weeks of March was "good", the following two weeks saw demand dip, with the next two months of April and May recording combined losses of GBP20 million.
No final dividend was declared, resulting in a total annual payout of 0.60p. For comparison, the year prior a final dividend of 1.05p was declared, taking the total annual payout to 1.60p.
Looking ahead, Chief Executive Robert Forrester said: "Given the heightened uncertainty of any forecast at this current time, it is inappropriate to provide any guidance with respect to market expectations. The board sees the group as well-positioned to take advantage of the opportunities which will arise. With its strong liquidity, disciplined approach to capital allocation and its partnership with manufacturers, the group looks forward with confidence."
As at May 22, Vertu had cash of GBP44.7 million.
By Ife Taiwo; [email protected]
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