9:01 am, October 27, 2022
Inchcape has reported record order books for new cars in the third quarter, and full-year profits could beat previous expectations.
Announced via the London Stock Exchange this morning (Oct 27), listed dealer group’s Q3 trading update showed revenue had risen by £2.1bn, up 16 per cent organically and 24 per cent on a reported basis.
The group revenue figures do not include Inchcape’s Russia business, which was disposed of in the second quarter.
The business, which trades internationally in numerous markets, said that during the quarter distribution was up 18 per cent organically, and retail was up 11 per cent organically.
In distribution, Inchcape said revenue was ‘ahead’ of the prior year, ‘supported by strong growth in both new and used vehicles and in aftermarket’. Revenue in Asia and Australasia reached its highest quarterly level since early 2021, while the Americas posted another record quarter.
In retail, pricing remained robust and aftersales performance ‘continued to be solid’.
In July, Inchcape announced its proposed acquisition of Derco, Latin America’s leading automotive distributor.
The Q3 results said the company expects completion of the Derco acquisition by the end of 2022 our Q1 2023.
Looking ahead, Inchcape said due to its strong Q3 performance it expects to deliver full-year profit-before-tax figures at the top end of the previously guided range of £350-370m), or even slightly above.
Duncan Tait, group CEO, said: ‘The group delivered another strong performance in Q3.
‘We achieved double-digit organic growth in both distribution, underpinned by higher vehicle volumes, and in retail.
‘We continue to see robust demand for vehicles, with record order books across many of our markets, and expect a gradual improvement in vehicle supply.
‘The combination of the strength of Inchcape’s business model and geographically diverse footprint means we are well placed to navigate the current macroeconomic climate.
‘A year following the launch of our Accelerate strategy we have delivered substantial progress against our growth drivers of Distribution Excellence and Vehicle Lifecycle Services.
‘We have extended our global leadership in automotive distribution, leveraging our digital and data investments, and continue to move forward with our ambition to capture more of a vehicle’s lifetime value with bravoauto – our digital-first, multi-brand used car platform.
‘In July we announced the proposed acquisition of Derco, Latam’s leading automotive distributor, significantly increasing our scale in the fast growth Americas region.
‘In addition, during Q3 we have further expanded our OEM footprint with exciting electric vehicle brands, adding Great Wall’s Ora in Hong Kong and Macau, and BYD in Belgium and Luxembourg.
‘This expansion is a great example of our Accelerate strategy in action, delivering on the group’s growth ambitions.’
He added: ‘With a clear strategy, driven by our ambition to be both better and bigger, Inchcape is well positioned to capitalise on further opportunities for organic growth and market consolidation.
‘I am confident we will continue to deliver sustainable long term value for all our stakeholders.’
