8:36 am, June 30, 2026
Bosses at the Northern Ireland-based Donnelly Group say they are ‘happy’ with the firm’s performance, despite a small dip in profits in the face of a ‘challenging automotive market and economic environment’.
Accounts recently filed via Companies House show that the franchised car dealer made a pre-tax profit of £4.36m in 2025, compared to £4.83m in 2024.
Donnelly Bros. Garages (Dungannon) Limited, the dealer group’s ultimate holding company, also saw turnover fall from £330.41m to £316.35m but those at the top are still in a positive mood.
The year saw gross profit margin rise 0.6% to 11.4%, while the group also outperformed the wider market in Northern Ireland to grow car sales by 22%.
The firm also invested heavily in expanding its partnership with VW Group, including ploughing £7m into adding VW, Skoda and Cupra to its Dungannon site.
The firm also opened a VW and Skoda showroom in Ballymena, in a move which now gives Donnelly Group responsibility for all VW Group brands outside of Belfast.
Explaining the drag on profits and turnover, bosses pointed to the impact of the ZEV mandate, which they said had a ‘damping’ effect on the wider new vehicle market throughout the year.
Writing in the accounts, company secretary Malcolm Kerr said: ‘For the financial year 2025, the group has reported a pre-tax profit of £4.36m vs £4.83m in 2024, a performance the directors are happy with, in the face of a challenging automotive market and economic environment.
‘The group outperformed the market – growing total car sales by 22%; Motability sales by 39.5% and new retail sales by 8.5%.
‘The Zero Emission Vehicle mandate, the governmment regulation to transition to Battery Electric vehicles is having a damping impact on the new vehicle market, with customer demand lagging targets.
‘Without further consumer stimulus and improvements in charging infrastructure, the ZEV mandate will continue to restrict retail market growth.
‘The Commercial Vehicle market declined by (5.9%) vs 2024, with the group posting a growth of 0.4%. There was growth in the used vehicle market which improved by 6.8% and now sits only (4.5%) behind pre-covid levels and we expect this market to be the growth sector in the industry over the next few years.
‘The economic environment remains challenging, and inflationary pressures from recently announced government taxation measures require improvements in cost control and operational efficiency to mitigate impact.’
Elsewhere, the accounts show that the Car Dealer Top 100 firm paid an interim dividend of £2m in 2025, although the directors did not recommend the payment of a final dividend.
Meanwhile, staffing costs came in at an increased £22.33m with an average workforce of 534 employees. At the same time, directors’ remunerations totalled £670,430 compared to £639,468 in 2024.
Looking ahead, bosses are backing the firm to return another profit in 2026, with the firm currently on track to meet expectations for the current year.
Kerr added: ‘The group’s aim is to grow revenues sustainably and grow as a scaled franchised dealer group, developing on our strong manufacturer partnerships, and adapting to evolving industry dynamics like the transition to Battery Electric Vehicles and the associated entrance of new manufacturers to an already congested marketplace.
‘2025 has seen see a major step in this ambition, with a significant expansion of our partnership with the Volkswagen Group which has resulted in the addition of Volkswagen Passenger Cars, Skoda and Cupra to the Dungannon site facilitated by a £7m investment.
‘In addition Volkswagen Passenger Cars and Skoda opened in Ballymena, giving Donnelly Group responsibility for all VW Group brands outside of Belfast.
‘As a group we have strong manufacturer partnerships in place to participate in industry growth and benefit from any structural changes as manufacturers transition to a model with fewer investor partners.
‘At the date of this report, the directors are confident that the company and its subsidiaries can continue to demonstrate their resilience.
‘Profitability in the first four trading months of 2026 is in line with group expectations and the directors are confident that profit expectations will be comparable with FY2025 budgets.’
