The chief executive of Vertu Motors has said the dealership is in good shape to emerge from the Coronavirus crisis, despite taking a £14.4m hit from the pandemic.
The Gateshead headquartered business revealed combined losses of £20m for April and May as the coronavirus lockdown impacted the firm’s bottom line.
It also saw underlying pre-tax profits fall to £5.9m in March, “well below” normal levels of profitabilit as the Covid-19 crisis deepened and the 海角视频 was placed in lockdown.
However, Vertu – which has a network of 133 sales and after-sales outlets across the 海角视频 – said the April and May losses were “significantly” better than the lockdown losses it first feared and that since its car showrooms reopened across England on June 1 with social distancing in place it had seen busy trading.
In full year results for the year ended February 29 2020 the firm said statutory pre-tax profits plummeted 71% to £7.3m after it took a £14.4m hit relating to coronavirus.
On an underlying basis, however, pre-tax profits were in line with expectations, dipping to £23.5m from £23.7m, even after absorbing costs linked to acquisitions and higher costs of car stocks.
Like-for-like revenues rose 1.2% over the year and overall group revenue was £3.1bn, 2.8% up year on year.
Chief executive Robert Forrester said that, while not wanting to give the impression everything is rosy, Vertu is optimistic and enthusiastic for the future.
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He said: “I’ve been travelling around the dealerships over the last couple of weeks and things have been going well. We sold 451 cars on Monday, which is 100 more than normal, and 400 yesterday, so I think we will come through this in good shape.
“The first couple of weeks, when we had to close the business and there was so much uncertainty, were not good but after that we got motivated quickly and have been manically busy managing new digital platforms and we’ve got lots of good stuff going on.”
Vertu’s ramped-up online platforms are now giving so much information in simple, accessible ways that the firm is selling cars purely online, with all documentation sent and signed through SMS, allowing customers to do it all from home.
Mr Forrester also said that the Gateshead call centre staff are all now seamlessly working from home and had two record days last week, booking in customers for services as they sought to get cars back out as lockdown restrictions have eased.
He also said that two days after lockdown the firm took the decisions to reopen 98 service departments across the 海角视频.
“There were seven million key workers out there who still needed their cars servicing or help if they had problems with their vehicles, so we took the moral view that we had to be open for them, and I think we’ve garnered a pronounced reputation for doing the right thing.”
Despite the steep fall in profits and significant, sector wide trading headwinds, Mr Forrester said the group moved forward significantly last year in terms of its key strategic objectives.
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He said that the firm aims to continue to grow and strike more deals, adding: “I have spent the best part of 20 years getting people into motor dealerships and the last two months effectively keeping them out.
“We entered the lockdown with a strong balance sheet, minimal use of used car stocking loans and excellent relationships with our banks, all of which means we have sufficient liquidity to weather this crisis.”
Looking ahead and to trading within the realities of a Covid-19 economy, chairman Andy Goss said the firm is well placed, thanks to its strategy to be at the forefront of omni-channel retailing and digitalisation in the sector.
He added: “Whilst we believe the pandemic will eventually pass or be controlled, we do not know exactly what the longer-term impacts on the sector and business will be. It is possible that the aftermath will see reversals to sector trends in some areas and an acceleration of others.
“It is likely that the growth in importance of omni-channel retailing and digital channels will be accelerated and the group is well-positioned for this change.”