Car retailer crashes to a loss as headwinds bite
Revenue and profits at Derby-based car retailer Motorpoint have fallen sharply for the six month to the end of September, with the firm blaming “market headwinds”.
Revenue fell by 22.8% to £607.2m, while the firm sunk to a loss of £3.5m against a profit of £2.4m for the period in 2022.
Motorpoint said that the profit crash was down to lower volumes and a fall in finance commissions. Retail volumes fell by 18.4% with wholesale volumes by 22.4% and more cars were sourced direct from consumers and sold through retail channels.
The company said that the impact of high inflation, interest rates and consumer uncertainty continues to affect demand for used cars, but that “key elements” of a normalised market are “already underway”.
Mark Carpenter, CEO of Motorpoint Group, said: “I have been at Motorpoint for twelve years and the agility and resilience of our business model is something of which I am immensely proud. We have no structural debt, a flexible business model, a fantastic team and a tremendous opportunity ahead to achieve significant cash generation in the medium term following the actions of the past twelve months. Our focus on improving unit economics has been successful, although volumes remained challenging in the period.
“The rapid fall in used car values since the period end is unquestionably a near term challenge, however it also provides reassuring signs of supply finally beginning to improve in the nearly new market that we have dominated in the past. I believe next year will be a key turning point for the market and I look to the future with confidence.”