Auto Trader cashing in on ‘trust and transparency’

MANCHESTER-based digital vehicle seller Auto Trader Group strategy of promoting” trust and transparency” with its customers is paying off as it reports a stellar six months with revenue 11% up to £153.9m and underlying operating profit rising 23% to £102.3m.

Operating profit in the period to September 25 grew 21% to £100.6m and basic earnings per share rose 28% to 7.65p (H1 2016: 5.98p).

In addition, net external debt was down £33.1m to £359.5m (March 2016: £392.6m), representing a reduction in leverage to 1.8x (March 2016: 2.2x).

Meanwhile, an interim dividend has been declared of 1.7p per share to be paid in January 2017 (H1 2016: 0.5p per share).

In the period, cross-platform visits increased by 36% to 58.5 million (H1 2016: 43.0 million) with consumer audience four times larger than that of the nearest competition.

Advert views per month increased by 4% to 250 million (H1 2016: 240 million), although the umber of retailer forecourts advertising on the Auto Trader marketplace down 1% at 13,374 (H1 2016: 13,503).

Chief executive Trevor Mather said: “Auto Trader, the UK’s leading digital automotive marketplace has delivered a strong first-half performance.  

“We have felt no discernible change in the competitive environment and no noticeable impact from Brexit to date.

“We remain focused on creating a simpler and more efficient marketplace, as well as enhancing the experience we deliver to consumers.

“Trust and transparency are key purchase drivers in today’s consumer buying journey. Auto Trader’s recent market report found that only 7% of consumers trust car retailers.
 
“We have therefore continued to improve our consumer experience by launching products and services such as dealer reviews and vehicle check that promote greater trustworthiness in retailers, as well as providing real time valuations that help to improve transparency in the car buying process.
 
“Despite the current wider economic uncertainty, the board is confident of delivering its growth expectations for the second half of the year.”