9:18 am, October 26, 2023
Independent Ford retailer Peoples has suffered a pre-tax profit decline despite revenue increasing.
Its accounts as Peoples Ltd for the year ended July 31, 2023 show that turnover rose by 11.3% from £275.7m to £306.8m but profit before tax fell by 12% from £8.3m to £7.3m.
Operating profit, meanwhile, was down by 17.6% from £8.5m to £7m.
In the accompanying report, it said it had been able to sell more vehicles thanks to the microchip shortage easing but margins had been cut because of increased industry competition.
Return on sales was 2.5% and chairman and MD Brian Gilda, pictured, said he was ‘delighted with these results’, acknowledging it ‘as a consequence of coming through a period of CV product supply constraints which adversely affected our vehicle volumes in that sector’.
He also praised ‘the outstanding loyalty of our customers’ in making the results special.
But he countered his delight by saying: ‘It does not however mean that we can declare all is well with the world and…allow ourselves the luxury of taking our foot off the gas.
‘For my team and I [stet], this is just not possible in the arena in which we operate.’
Gilda also touched on the agency sales model when he highlighted Peoples’ new seven-person operational board, saying it was ‘defining and implementing the strategies needed…as we consider the potential changes to the franchise system and how it will affect us’.
And he praised Peoples’ workforce, commenting: ‘As always, I would like to thank all those members of staff who worked tirelessly during the year to improve their contribution to the wellbeing of the group and ask them to rededicate themselves to the year ahead.
‘The group has consistently sought to recruit and retain the best employees in the marketplace and this has undoubtedly contributed to our success and is a course of action which will remain at the forefront of my thinking.’
Turnover comprised £291,623,523 from vehicles (£262,349,101 in 2022), £7,184,167 from workshops (£6,128,405) and £7,958,447 from parts (£7,184,739).
Directors’ emoluments rose from £470,825 to £490,836 – up by 4.3% – with the highest-paid director receiving £296,960, which was up 3.6% on the previous year’s £286,608.
In a press release, Peoples said new car sales were up by 21%, used car sales were up by 11% and aftersales profits rocketed by 31%. However, commercial vehicle sales dropped by 17% because of a shortage across the industry.
Gilda said in the press release: ‘We reflect on these results with delight.
‘Despite having come through a period of commercial vehicle supply constraints which adversely affected volumes across the sector, we exceeded our operational benchmarks and financial targets.
‘Our increase in new and used personal vehicle sales positively impacted our turnover and our huge upturn in aftersales is testament to consumer confidence in our brand and our experts.
‘They know their cars are in good hands with our erudite, qualified technicians, and we know if we look after our customers well they will continue to come back to our service department.
‘The driving force behind the financial year’s successes is the operational board, which we established in 2022, allowing us to make quick and smart decisions on our current position and future strategy, and we are continually investing in capital and infrastructure projects.’
Peoples, which is financed by its own cash reserves, has six dealerships – three in Edinburgh, Falkirk, Livingston and three across Liverpool – and says it is now the largest independent solus Ford dealer in the UK and continental Europe.
It was ranked 50th in the 2022 Car Dealer Top 100 list of most profitable dealer groups. The 2023 Car Dealer Top 100 will be out soon.
