7:32 am, November 25, 2020
Cambria Automobiles saw its pre-tax profit drop by 18.4 per cent to £10.2m over the past year as the pandemic took its toll on trading.
Releasing its results this morning (Nov 25) for the year to August 31, the motor retailer reported a strong first half, but trading performance was overshadowed significantly in the second half by coronavirus and the first lockdown.
Revenue, meanwhile, fell by 20.3 per cent to £524m.
Sales of new cars decreased by 26.3 per cent, while used car sales dropped by 20.9 per cent and aftersales revenue fell by 14.7 per cent.
The drop in used car sales was, however, partially offset by a 7.7 per cent improvement in profit per vehicle.
Chief executive Mark Lavery said: ‘The unprecedented and ongoing effects of the Covid-19 pandemic have put the group through the most challenging period in its history, though against this backdrop the business has demonstrated its resilience.
‘We endured the material and devastating impact of Lockdown 1 (24 March until 31 May), followed by the bounce back and pent-up demand experienced during the summer months, which went some way to offsetting the damage the pandemic inflicted during that time.
‘The performance in the first half of the financial year to 29 February 2020 was unaffected by the pandemic and we had traded strongly during this period.
‘In our interim results published on 6 May 2020, we highlighted that the impact of the pandemic and national lockdown would have a material negative impact on the financial performance in the second half, and particularly during the March to May period the year-on-year negative variance was significant.
‘The dramatic economic impact of the pandemic forced the board to consider all its operating procedures and guest-handling processes.
‘We took decisive action to protect the group and to make it leaner, more flexible and agile in preparation for a very different market place and society once we emerged from the crisis.’
He added: ‘At the time of writing, we are in the second enforced national lockdown, and whilst our leaner, more flexible and more agile business is better equipped to deal with the challenges of a lockdown on our industry, it is still having a significant impact on our day-to-day trading.’
Looking ahead, Lavery told of his concerns about the UK’s future relationship with the EU after the end of the Brexit transition period on December 31, saying he feared it could lead to tariffs for cars and parts imported from Europe.
That in turn will force up the price of those goods for consumers.
He also pointed out the 2030 ban on the sale of new petrol and diesel cars plus the 2035 ban on hybrids will mean a massive cost in research and design for manufacturers – which will also lead to higher prices for the public.
Lavery said: ‘Trading in the current financial year started well, with September and October results ahead of the previous year before the enforced Lockdown 2 commenced, which has again had a material negative impact on trading.
‘As a result of the unprecedented challenges imposed by Covid-19, Lockdown 2, the structural changes facing the automotive industry and the economic challenges that the UK will face post-Brexit and pandemic, the board remains cautious in its outlook though confident that the group has the right business model to face the challenges ahead.’
Its annual meeting will be held on January 7 at Grange Aston Martin in Hatfield. Because of the pandemic and associated government measures, it will be a closed meeting.
- Register as a Car Dealer member and get more out of the website here
- Car Dealer Mag issue 153 is out now – Read it here
- Join our breaking news WhatsApp group – Click here to join now
