Marshall Motor Group posted an underlying loss of £8.9m for the first half of 2020 – down from a profit of £15.2m for the same period last year.
The loss, which takes into account the devastating impact of the coronavirus lockdown on car dealers will be seen as a small win for the listed dealer group, especially as it is predicting to break-even by the end of the year.
Revenue was severely hit by the crisis, though, down from £1.1bn to £895m – a drop of 24 per cent.
In the announcement to the Stock Market this morning, Marshall said that in the period prior to the lockdown it had been trading ‘significantly ahead’ of the market.
However, the crisis hit new and used car sales. New car sales for the group were down 37.7 per cent for the period – against a market down 48.5 per cent.
While used car sales were down 31.8 per cent – a result Marshall describes as ‘pleasing’ considering the fact its dealerships were closed during lockdown.
Chief executive Daksh Gupta said: ‘Despite the significant challenges presented by COVID-19, the group has delivered a resilient first half performance and once again outperformed the market.
‘Since full reopening under Covid-19 secure guidelines on June 1, trading has been robust and our important Q3 order take is encouraging.’
Gupta thanked his colleagues – many of whom were placed on furlough during the crisis but are gradually coming back to work (88 per cent so far) – and his manufacturer partners for their support during the difficult time.
The interim results also showed the group has significant cash in the bank – helped by the VAT deferral scheme – with £27.4m in the account as of June 30. At the same time last year, the group had £5.8m in the bank.
Marshall has also renewed its revolving credit facility in July until 2023 – giving it access to £120m for acquisitions.
The results also detailed the response Marshall made to the crisis which closed most of its business from March 23 to June 1.
It said it managed to maintain a retail presence online and phone for customers and by careful ‘cost mitigation’ and preserving cash it moved quickly to shore up the business.
Since reopening on June 1 the group says sales performance has been ‘encouraging’.
No interim dividend was declared.
Mike Jones, ASE Global chairman and compiler of the Car Dealer Top 100 which will be published later this year said it was positive to see the company building for the future.
He said: ‘Marshalls has produced a creditable performance as they give us the first detailed insight into the impact of the lockdown on UK motor retail.
‘Turnover was clearly down significantly, albeit outperforming the market, however cash generation was strong leaving the business well positioned to capitalise on opportunities as we go through the second half of 2020 and into 2021.
‘It is particularly pleasing to see the September order bank building well as a strong performance in this plate-change month will be vital to deliver a turnaround into overall profitability for the year.’
Car Dealer will be chatting to Gupta at 8am and the video interview will be published on this post soon after that.
**This breaking news story is being updated live**
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