LOOKERS today announced a second consecutive year of record results.
The car dealership and parts supplier achieved a 7.7% increase in sales of £1.9bn in the year to December 31 and a 170% improvement in pre-tax profits of £31.1m.
Business in the new financial year is also strong and first quarter results should better budget predictions and the previous year.
Chief executive Peter Jones said: “Both our motor and parts divisions delivered record performances and we continued to reduce cost, improving efficiencies.
“We have made a good start to 2011 within the business with an above plan performance which, combined with our strengthened balance sheet, places us in a strong position, giving confidence that we will continue to trade successfully and be in a position to pursue selective strategic growth opportunities as they arise.”
Net debt was reduced during the year by £22.4m to £56.6m.
New car retail sales for Lookers were 10% ahead of the UK market and pre-tax profits for the sector were 12% better than 2009.
The independent parts division, which accounts for more than 35% of group profits, extended its range and achieved an 11% rise in pre-tax profits.
Lookers’ plan to seek selective acquisitions follows a period of restructuring which involved the sale or closure of underperforming dealerships. The group operated more than 20 across Merseyside and Cheshire but now has 11 sites in the region.
Chairman Phil White said the review resulted in an improved group performance and a reduction in costs which, together with “substantial headroom” in its bank facilities will allow it to take advantage of “strategic growth opportunities that may arise for both the motor and parts division”.
The motor division now comprises 119 franchise dealerships, representing 33 motoring marques from 71 sites.
Chief executive Peter Jones said today: “We have a healthy order book for the delivery of new cars in the important month of March and aftersales continue to perform well with the result that the motor division is ahead of both budget and prior year.
“Furthermore, the independent parts division has made further progress and is ahead of budget. We therefore expect the result for the first quarter to be ahead of both budget and last year.”
Liverpool stockbroker Panmure Gordon said today’s results were slightly ahead of forecast pre-tax profits, adding: “The outlook for the rest of the year appears confident, despite the uneasy consumer backdrop.
“We maintain our target price of 80p and our positive stance on the shares post these results, with the company well placed to use its strong balance sheet to derive value from acquisitions further down the line.”
