Pendragon PLC PENDRAGON PLC INTERIM MANAGEMENT STATEMENT (2840E)
November 03 2015 - 1:00AM
UK Regulatory
TIDMPDG
RNS Number : 2840E
Pendragon PLC
03 November 2015
PENDRAGON PLC INTERIM MANAGEMENT STATEMENT (ISSUED
03-NOV-2015)
This Interim Management Statement for Pendragon PLC, the largest
and leading automotive retailer in the UK, covers the period from 1
July 2015 to 2 November 2015. Unless otherwise stated, figures
quoted in this statement are for the three months ended 30
September 2015.
Trevor Finn, Chief Executive:
"We continue to go from strength to strength after another
strong quarter across our key sectors of aftersales, used and new.
We continue to deliver on our winning strategy of offering choice,
value, service and convenience to our customers and we are ideally
positioned to gain from favourable underlying market conditions for
aftersales, used and new. The performance of the Group is in line
with expectations for the full year, which were upgraded in
August."
Highlights
-- Used gross profit grew by a significant 15.2% on a like for like basis, as our focussed strategy continues to
increase our market share and profitability.
-- Aftersales gross profit grew by 3.8% on a like for like basis as we benefit from strong underlying market
dynamics together with our aftersales initiatives.
-- New gross profit increased 5.3% on a like for like basis, as a result of the continued improvement in the new
vehicle market.
-- Overall in the quarter, underlying like for like profit before tax increased by 6.6%.
-- Online visits to Stratstone.com and Evanshalshaw.com increased by 35.9% in the nine months ended 30 September
2015. This significant increase is assisting our brand building and used and aftersales activity levels.
-- We continue to be encouraged by the results of the UK's first automotive 'click and collect' service, "Move Me
Closer" and our "Sell Your Car" initiative.
-- Our financial position is strong, with our debt ratio remaining significantly below our target range.
Trading Update
We operate our core business in the used, aftersales and new
vehicle sectors under the Evanshalshaw.com and Stratstone.com
brands. We also have a number of support businesses in the
associated markets of dealer IT systems, vehicle leasing and
parts.
Aftersales is our largest profitability contributor and gross
profit grew by 3.8% in the period on a like for like basis. The
Group is benefiting from the increased new vehicle supply which
continues to increase the less than three year old car parc and the
four to six year old car parc. Additionally, we have achieved
growth by enhancing the customer proposition through technology,
such as enabling the customer to view vehicle service and repair
issues on video direct from the workshop and to authorise work from
the link provided, all via their electronic device.
Used profitability growth continues to significantly enhance the
profitability of the Group and is a key strategic priority for the
Group. Used gross profit grew by 15.2% in the period on a like for
like basis. This resulted from a number of initiatives including:
our 'click and collect' proposition
(www.evanshalshaw.com/move-me-closer), providing convenience with
over 200 retail points, our product choice, with over 20,000 used
vehicles to view and our focus on stock procurement. We are
maintaining our marketing investment in this area so we continue to
build market share.
New gross profit, our third largest contributor to
profitability, grew by 5.3% in the period on a like for like basis.
In the year to date we have invested GBP21.8m in relation to our
franchise facilities including expenditure on refurbishment work,
relocation of sites and acquisition of freehold interests.
Our financial position remains strong, with our debt: underlying
EBITDA ratio remaining significantly below our target range of 1.0
to 1.5. We are in the process of further investment in the roll-out
of additional footprint to provide us a truly national UK presence
for the sale and servicing of vehicles.
Industry Insight
When publishing our prior year interim and year end results we
indicated that new car registrations would now run in 2015 at a
more "natural" level of 2.5 to 2.6 million units per annum. After
analysing September registrations we are expecting 2015 annual
registrations to be over 2.6 million units. Year to date
registrations to 30 September 2015 increased by 7.1% year on year,
with retail registrations increasing by 2.4%. We believe the UK new
car market has reached its natural level.
The latest available data shows that the used car market
increased by around 0.8% in the first half of 2015. We are still
expecting the used car market to grow by between 1.0% and 2.0% for
the whole of 2015.
The aftersales market continues to be favourable for the nearly
new vehicle car parc as a result of the new car market increases in
the last three years. These favourable conditions will flow into
the four to six year old car parc in the coming years. We continue
to expect the less than three year old car parc to grow by 7.0% and
the four to six year old parc to grow by 2.0% in 2015.
Outlook
As the largest and leading automotive retailer in the UK, we are
focussed on our winning strategy and continue to build market share
in our key markets. We are well positioned financially and
strategically to continue to be the largest and leading automotive
retailer in the UK. We expect 2015 full year performance to be in
line with expectations.
Enquiries
================ =================== ============ ==============
Pendragon
Trevor Finn Chief Executive PLC 01623 725114
Pendragon
Tim Holden Finance Director PLC 01623 725114
Gordon Simpson Partner Finsbury 0207 2513801
Philip Walters Principal Finsbury 0207 2513801
================ =================== ============ ==============
This information is provided by RNS
The company news service from the London Stock Exchange
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