8:13 am, June 2, 2023
Inflation and higher business rates resulted in profits falling for Caffyns last year.
The East Sussex-based business saw underlying profit before tax slump from £4.3m in FY22 to £3.1m FY23, preliminary results for the year ended March 31, 2023 published today (Jun 2) on the London Stock Exchange show.
In the accounts, the dealer group – which has showrooms across Sussex and Kent and represents Volkswagen, Audi, Seat, Skoda, Vauxhall, Volvo, MG and Lotus – said ‘profitability was constrained by significant upward cost pressures in areas such as business rates and funding and other overhead costs in an inflationary environment’.
Chief executive Simon Caffyn remained positive, however, saying: ‘Underlying profit before tax for the year of £3.1m, whilst lower than the £4.6m recorded for the prior year, was a strong result and still remained significantly ahead of that reported in the years running up to the Covid-19 pandemic.’
Revenue was up 12 per cent – or £27m – though, to £251.4m (2022: £223.9m), of which £25m arose from new and used car sales
New car deliveries jumped by an impressive 34 per cent, while sales of used cars dropped by four per cent. The firm said it was ‘broadening’ its sources for replenishing used car inventory, mostly due to a shortage of less-than-three-year-old cars.
Aftersales revenues, meanwhile, rose by nine per cent to £27m.
Caffyns said like-for-like comparisons exclude the impact of its MG and Lotus dealerships in Ashford, Kent, and its Lotus showroom in Lewes, East Sussex, which all opened during the year.
The firm said it ‘remains encouraged with the opportunity’ for Lotus while it also remarked its Vauxhall business in Ashford, Kent, ‘under performed’.
Meanwhile, Caffyns also said business at its Motorstore used car showroom in Ashford ‘remained subdued’ as a result of it struggling to source stock.
A second used car centre – ‘Performance Motorstore’ – opened during the year alongside its Lotus showroom in Lewes.
Caffyns issued a cautious outlook for the year ahead, citing cost increases and ‘short-term disruption’ as some manufacturers switch to agency sales.
