North East motor retailer Vertu says it is targeting further acquisitions to drive growth after announcing it will post profits of around £23m this financial year.
The Gateshead based business, which has a network of 147 sales and aftersales outlets, has published an update on the five months to January 31, ahead of publishing results for the year later this spring.
The board said it expects the group’s trading performance for the year ended February 28 to be in line with analyst forecasts, with pre-tax profit of around £23m.
Over the last five months it said group revenues grew by 4.1%, reflecting the impact of significant acquisition activity last year which saw it add 29 outlets to the firm’s portfolio.
It said like-for-like new retail vehicle volumes declined 13.3%, in line with the market, but that it delivered growth in like-for-like used vehicle margins.
Meanwhile, significant progress has been made in technology advancements driving the group’s ‘omni-channel’ capabilities and use of robotics to improve productivity - a move which has been accelerated after the successive closures of sales showrooms.
It said: “Significant investment in TV campaigns as well as extensive, well-executed digital campaigns have led to high enquiry levels.
“Customer reticence to buy used cars without a test drive and review of the car pre-purchase have been partially overcome with a 14-day money back guarantee. Free delivery within 30 miles also encourages a more contactless experience.”
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As part of its strategy to multi-franchise certain of the group locations it has made a number of changes and additions, including exiting its Citroen franchise in Leicester, which was sold yesterday, February 28, to Robins and Day. It is, however, retaining the leasehold premises, which it plans to reopen with another manufacturer franchise.
Today, March 1, it has also added the Peugeot franchise to it Edinburgh dealership. The business is based in leasehold premises but it will relocate into a new purpose-built freehold dealership when the lease runs out in a year.
It also opened a used vehicle ‘Macklin Motornation’ operation today, in newly acquired freehold premises in Glasgow.
It added that Government support received through the furlough scheme and business rates relief totalled £8.2m in the five month period and that, looking ahead, it has a strong pipeline of potential acquisition and multi-franchising opportunities.
Chief executive Robert Forrester said: “I am pleased to report that the board expect the trading result for the year ended 28 February 2021, at an adjusted profit before tax level, will be in line with current analysts’ forecasts of around £23m.
“The period includes two national lockdowns, in November and from 4 January, which closed our sales showrooms. Despite the impact of these national lockdowns and regional lockdowns throughout December, the group’s strong marketing activity, use of omni-channel retailing functionality and cost control have meant that a creditable trading performance was attained in the period.
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“This result has been delivered by a huge Vertu team effort and I would like to thank every single one of my colleagues for their hard work and dedication in what has been an extraordinary period.
“Notwithstanding the Government’s recently announced roadmap, the outlook remains uncertain given continuing Covid restrictions, although Brexit uncertainty is now behind us and the pound’s recent strengthening should help to make cars more affordable to 海角视频 buyers.”