Fall in new car sales hits valeting company Autoclenz
VEHICLE valeting firm Autoclenz has seen profits dip during the first half as sales of new cars continue to decline.
The Midlands-based firm said its Automotive operation has seen sales fall 3.3% during the period, however, this was set against a 7.1% decline in sales of new cars.
The picture was healthier in its Specialist Cleaning operation, where sales rose 21.9% during the first six months.
Group sales during the first half reached £13m (2010: £13.3m). Underlying operating profit was lower at £0.58m (2010: £0.68m). Underlying earnings per share fell to 3.99p (2010: 4.74p).
James Leek, chairman, said within Automotive Services trading remained difficult with new car sales down by 7.1% in the first half 2011 and the consequent impact on used car sales.
“In most cases we are seeing a number of our customers reporting sales lower than in the same period last year. However during the first half of 2011 we have renegotiated contracts with two of our major valeting customers, one within the Auction Sector and the other within our Pinnacle Brand. Both of these renegotiations entailed some reduction in gross margin,” he said.
“However the renegotiation within the Pinnacle Brand brought with it new business in both the Midlands and the North West of England which will allow us to grow this brand outside of its current South East operational base.
“Also during the first half of this year we gained further new business in addition to that already mentioned which has had a slight negative impact on our overall profitability as we settle down these accounts and achieve operational efficiencies.”
