Notts car giant predicts profits slump

Pendragon, the Nottinghamshire headquartered firm behind the Stratstone and Evans Halshaw dealerships, has said it expects profits to fall back this year, before returning to growth in 2018.

The firm told the London Stock Exchange this morning that profits will come in at around the £60m – down from £75.4m last year.

Pendragon is putting the performance down to a decline in demand for new cars and the consequent used car price correction.

A statement from the firm said: “During the quarter as consumer confidence waned we experienced significant market pressures. As described below we expect the new car market to continue to decline this year and the first half of next year as car manufacturers continue to adjust to the reduced level of demand for new cars.

“Our business is underpinned by stable aftersales profitability and we expect our used car volumes to continue to grow as we make progress on our goal to double used revenue in the five years to 2021.”

Meanwhile, Pendragon also revealed that chairman Mel Egglenton is to step down as chairman “for personal reasons”.

Chris Chambers, a non-executive director since January 2013 and the senior independent director since November 2014 has been appointed as Chairman.

Egglenton said: “I am pleased to have led the development of Pendragon since being appointed Chairman in May 2013 and feel that we have achieved much in a challenging retail environment. I am confident that in Chris Chambers, we have a chairman whose skills and experience are ideally suited to the next stage of the company’s development.”

Chambers said: “Mel’s sound guidance and firm leadership have been invaluable to the development of the Company’s strategy over the past four years. I look forward to working with the Board and the executive team in the next stage of the company’s development.”

The firm says it will concentrate on putting its software “at the heart” of the business as it enters 2018.