Pendragon eyes expansion on strong motor sales
STRONG sales of Land Rover, Mercedes-Benz, MINI and Porsche have helped to benefit the first half performance of Midlands-based motor dealership group Pendragon.
The company, which comprises the Stratstone (premium) and Evans Halshaw (volume) brands plus an operation in the United States, said it had also done well on strong fleet sales as the favourable market conditions continued to benefit the business.
In light of demand, the company said it was now looking to expand its footprint into areas where it was unrepresented.
Trevor Finn, Pendragon, chief executive, said: “Our business continues to perform strongly across all sectors, owing to a combination of our strategy, market leading initiatives and favourable market conditions.
“We continue to be excited by the initiatives launched last year, ‘Sell Your Car’ and ‘Move Me Closer’, which appeal to customers from our key brands of Evanshalshaw.com and Stratstone.com.
“We plan to expand our footprint, by adding sites particularly in areas where we have no representation, which will provide further convenience to our customers.”
The strong first half has enabled the group to double its interim dividend, aligning it with its higher year dividend for 2014.
“The group has had an encouraging start to the year and our anticipated outturn for the full year is comfortably ahead of expectations,” added Finn.
The anticipated outturn for the full year is now comfortably ahead of expectations. For the first half, underlying pre-tax profit was up almost 23% to £40.3m (2014: £32.8m). Underlying earnings per share rose 23.8% to 2.13p (2014: 1.72p).
The period saw a record used performance with gross profitability up £6m or 8.3%, which was driven by some market leading initiatives.
Aftersales gross profit increased by £6.2m or 6.7%.
The Stratstone business is one of the UK’s leading premium motor car retailers, with 76 franchise points. Stratstone holds franchises to retail and service Aston Martin, BMW, Ferrari, Jaguar, Land Rover, Mercedes-Benz, MINI, Morgan, Porsche and Smart vehicles as well as three motor-cycle franchises.
Stratstone.com had a strong year to date, on a like for like basis, operating profit increased by £3.6m or 20.3%. The new department improved like for like gross profit by 19.1% as a result of strong retail growth performances in Land Rover, Mercedes-Benz, MINI and Porsche.
Used revenue was up by 9.5% on a like for like basis in the period, albeit at a lower margin, resulting in a slight fall in used profitability. Aftersales grew strongly in the period, with gross profit up 5.4% on a like for like basis.
The Evans Halshaw business is the UK’s leading volume motor car retailer, with 124 franchise points. It holds franchises to retail and service Citroen and DS, Dacia, Ford, Honda, Hyundai, Kia, Nissan, Peugeot, Renault, SEAT and Vauxhall vehicles.
Evanshalshaw.com increased like for like operating profit by £7.6m or 42.7%, with outstanding growth in the used vehicle department. On a like for like basis, used sales increased by 13% in the period and used gross profitability increased by 17.3%.
Its retail business in the US continues to achieve strong results from its nine franchise points in Southern California, where it represents the Aston Martin, Jaguar and Land Rover brands.
