Johnsons Cars saw its pre-tax profit plummet last year to £632,000 from £4.61m in 2018, the dealership group has revealed.
Meanwhile, its annual report for the year to December 31, 2019, filed with Companies House, also shows that turnover rose from £432.4m to £457.2m.
Johnsons – which has 46 showrooms across the south, the Midlands and north-west, and represents 16 brands – bought four Volkswagen dealerships for £7.2m from Goodman Retail Ltd in November 2019. and combined they lost £392,000 by the end of the year.
Two loss-making businesses were shut – its leasehold Honda Beaconsfield trade transferring to Slough and a freehold VW aftersales site in Willenhall being sold for £650,000.
Unsurprisingly, the Redditch-based company, which sells new and used vehicles, has been hit hard by the pandemic and lockdowns this year, with the spring lockdown having ‘a £4.8m adverse variance’ on its plans, the directors said in the report.
But there had been high demand since reopening in June, and by the end of July it had reached 90 per cent of normal staff coverage while operating at more than 120 per cent of normal sales levels.
‘It is well publicised that all businesses in the sector had a buoyant rebound from lockdown and we are not an exception,’ said director Richard Martin in the report.
The second lockdown will mean another fall in income but the financial implications won’t be as severe, it said.
‘The directors are certain that their handling of the crisis since March till today has been…thoughtful, professional and considered…to ensure the survival of the company for the betterment of all stakeholders in the business,’ added Martin.
With the end of the Brexit transition period nearing, Martin said: ‘We are leaving and no one knows how this will work out yet.
‘How it will affect Johnsons Cars is too early to predict, but it may mean that we have to contend with increased new car prices and parts prices.
‘Used cars will most likely become much more attractive as a consequence and service prices will increase. We consider this uncertainty to be much longer lasting and very significant.’
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