Lookers drives ahead with car sales

CAR dealership business Lookers has continued its recent positive run of form, posting a 2% increase in new car sales for the nine months to September 30, despite an overall market decline of 5%.

Its out-performance of the wider market for new car sales was largely due to increasing volumes of fleet car sales.

New car sales to retail customers actually fell by 10%, but it increased fleet volumes by 30%, which it said was “significantly” ahead of an overall market increase of 4%.

Its used car sales increased during the last quarter and are 4% higher than last year for the nine months to September 30, while aftersales revenues and margins have remained largely flat in a declining market.

The company, which has a number of dealerships in Yorkshire, said that its parts division had continued to perform well, despite a reduction in sales to two of its bigger customers.

It added that it was currently in talks with its syndicate of banks about replacing its existing debt facilities, which consists of a revolving credit facility of around £53m and a term loan of £81m.

Lookers also announced that it had brought in £12.7m since the start of the year through the sale of unwanted garages, which meant that its net debt was lower than both its budgets and the corresponding figure a year ago. At the start of this year, the company had net debt of £56.6m.

“The new and used car markets continue to be affected by uncertain economic conditions and the impact this has on consumer confidence,” the company said.

“However, the aftersales bias to the business and the strong performance over the last two years demonstrates the ability of the group to perform well in a difficult market.”