Inchcape says it is set to make more than £108m pre-tax profit for 2020 thanks to better performance in November than expected.
In an upbeat trading update issued via the London Stock Exchange this morning (Dec 10), the multinational automotive group said restrictions during November had had less of an impact than previously feared.
An update for the third quarter that it released on November 5 had said that although the group was on course to deliver a performance ‘significantly ahead of market expectations’, the lockdown restrictions that had just started were affecting a number of its markets.
It therefore felt at the time that it wasn’t prudent to give guidance for the full year.
However, today Inchcape said: ‘It is now clear that the restrictions have had less of an impact on our performance than might have been expected, with resilient demand for both vehicles and aftersales services.
‘This was supported by our ability to continue delivering vehicles, provide a click-and-collect service and to continue to perform aftersales services in the affected markets.
‘In light of this better-than-expected performance in November, and the limited restrictions in place as of today, we expect 2020 profit before tax (pre exceptionals) will be materially ahead of the published market consensus (£108m).’
Inchcape has been busy offloading sites to Vertu Motors as well as Hendy Group, and today’s update added that Inchcape’s overall financial position had strengthened further because of its ‘highly cash-generative business model’.
Inchcape said that meant it expected its year-end net cash position to be substantially above that of 2019.
Its full-year results will be published on February 25, 2021.