VERTU Motors plc, the UK’s fifth largest automotive retailer with a network of 132 sales outlets, has reported robust trading despite Brexit in the first half of 2016. Vertu predicts record profits and revenues in a pre-close trading update.
Full line results are expected to be in line with market expectations when the group’s half-year results are announced on 12 October.
Vertu acquisitions in the past 12 months
- June, 2016 – Gordon Lamb Group Ltd for £18.7m – five outlets in Derbyshire (4 volume, one Land Rover); brought Toyota into Vertu portfolio
- May 2016 – Leeds Jaguar for £650,000
- March 2016 – Sigma Holdings Ltd and Greenoaks (Maidenhead) Ltd for £21.9m – Brought Thames Valley Mercedes-Benz franchise to Vertu plus Greenoaks operated Mercedes-Benz outlets in Reading, Ascot and Slough
- January 2016 – Three Honda dealerships from Lookers plc for £2m in Nottingham, Derby and Stockton-On-Tees
- December 2015 – Who’s Ace Holdings Ltd for £2.2m – on-line vehicle parts business (www.aceparts.com) based in Sittingbourne, Kent.
- October 2015 – SHG Holdings Ltd for approx £12.8m brought Audi franchise to Vertu among three well respected and established Audi, VW Cars and VW Commercials outlets in Hereford
In line with the group’s AGM statement made on 20 July 2016, trading has been robust with profitability ahead of last year. The board expects that the group’s full year results will be in line with market expectations with record revenues and profits.
Aftersales and used cars, from which the group derives the majority of its profitability, have continued to grow demonstrating the resilience of the business model.
SMMT data has shown UK private new retail vehicle registrations softening since April 2016 compared to the strong prior year comparative period and the board expects this trend to continue.
September order-take levels on new vehicles reflect continued growth in the fleet and commercial sector and a continuation of the softening in the private retail new car channel, says Vertu.
The company added: “The macro-economic environment of historically record low interest rates and record high levels of employment in the UK provide a favourable economic backdrop for the sector.
“Weaker exchange rate levels for sterling create uncertainty around future manufacturer strategies towards new car pricing.
“The result of the Referendum to leave the European Union has, to date, not impacted consumer confidence as adversely as some were initially predicting and the group has not experienced any significant change in consumer behaviour.
“The board continues to pursue its strategic objective of creating a balanced, scaled automotive retail group comprising both volume and premium outlets.”
In the last 12 months, the group has acquired four volume and 12 premium outlets and the board says it is pleased with the performance of the recently acquired dealerships and with the integration of these businesses into the group.
The group’s half-year results will be announced on 12 October 2016.