Motor dealership group Sherwoods is eyeing possible acquisitions after a year in which turnover rose but profits fell.
The Washington firm has released accounts for 2022 which show that its turnover increased from £74.2m a year earlier to £91.5m. Over the same period, the company’s operating profit fell slightly to £1.1m while Sherwoods recorded a profit for the financial year of £633,789. The company has sites in Durham, Gateshead, Washington and Sunderland, representing major motor manufacturers including Suzuki, Citroen, Peugeot and Isuzu.
The 90-year-old firm - which is run by the MacConachie family - added the Sunderland Citroen business at the start of 2022 when it took over Sunderland’s Town Centre Automobiles, in a deal that strengthened its relationship with Citroen and Peugeot owner Stellantis Group. Town Centre Automobiles was founded in 1977 with the opening of a showroom in Villiers Street, in Sunderland city centre, under the name Town Centre Garage Ltd, and following the deal the company was named Sherwoods Town Centre.
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The motor group said it was also open to other growth opportunities. The accounts say: “During 2022 the business traded very well despite the challenges of new car stock supply shortages, changes in Stellantis systems, the war in the Ukraine and the inflationary pressures of utilities and alike, as well as a general downturn in customer confidence and demand in the second half of the year.
“Our success with the brands was rewarded with us winning Citroen awards for best medium sized dealer (Gateshead), best large dealer (Sunderland), best overal dealer (Gateshead) and one of our staff won Sales Person of the Year.
“We know 2023 is giong to be tough with increased energy costs, borrowing costs and alike but we have a strong, well performing business and a robust balance sheet and will be more than able to ride out any storms. We also will be looking for further opportunities to grow our business should the opportunity arise.”
The accounts cover a difficult period for the automotive industry, with microchip shortages and other supply chain issues hitting production by many of the main manufacturers, while the cost-of-living crisis reduced customer demand. Recent months have seen a recovery in the sector, with the new car market growing 24.4% in August, though that still left sales lower than pre-pandemic levels.
The bulk of Sherwood’s turnover in 2022 (£83.6m) was from vehicle sales, with smaller amounts from aftersales and commissions. The company’s headcount rose from 123 to 162 during the year, adding nearly £1m to the company’s wage bill.
