Evoque Factor puts Pendragon on the road to success

THE high demand for the new Range Rover Evoque has boosted the sales performance of leading car dealership group Pendragon, the company said today.

The Midlands-based group, which sells the Evoque through its chain of premium Stratstone dealerships, said new models from BMW had also helped generate new car revenue.

However, it said its used car operation was where the real growth had taken place, with a double digit rise in the first quarter when compared to last year.

Other dealership groups Inchcape and Lookers both reported similar trends.

In an AGM statement covering the period January 1 to May 9, 2012, Pendragon said: “The group is making good progress in quarter one and is in line with expectations.  The group continues to significantly outperform in the used car sector with double digit growth in the first quarter and is further benefiting from a lower interest charge in 2012 due to its lower debt profile.”
 
Nevertheless, it said its Aftersales business remained the principal area of profitability for the group even though in Q1, like for like service retail sales stayed at last year’s level.

 Like for like used volume grew of 11.4% during the period and continued to significantly outperform the national market volumes.  During the quarter used retail margins have been improving steadily since the start of the year.  

It said a key factor was the on-going investment in used car initiatives and growth in its online business where levels were up 24% compared with Q1 2011.

“The new car sector is an important component of the group’s activities,” it added.

“We continue to work together with our manufacturing partners to achieve the sales and customer goals that we both strive to achieve.  For the brands we represent within Stratstone, national retail registrations increased by 7.2% in the quarter, whereas our new retail sales increased by 13.8%.  

“The group has particularly benefited from new product activity from Range Rover Evoque, BMW 1-series and BMW 3-series.”

Trade at its volume market dealership network, Evans Halshaw, increased 5.9% in the quarter.

The group is now operating at a lower average debt level in 2012, consequently£3m has been shaved off its interest payments.

In outlook, it said it continued to make good progress in its key strategic areas.  

“Used performance continues to be a significant growth area for the group and is differentiating us from our peer group.  We are encouraged by our aftersales performance despite the difficult market conditions and the new car sector has benefited from some key new product launches in the first quarter.  

“The group is on track to continue the momentum from 2011 and quarter one and remains in line with expectations for the full year,” it said.