VERTU Motors achieved record profitability in the year to February 28, the company announced today.
The business, the fifth largest automotive retailer in the UK, reported adjusted profit before tax of £31.5 million (up 15 per cent on last year’s figure of £27.4 million) and operating profit of £32.1 million (up 18 per cent on last year’s total of £27.2 million). Profit before tax was up a healthy 14.6 per cent to £29.8 million.
Overall, revenue was up to £2.8 billion from £2.4 billion – a 16.5 per cent improvement.
The company – which has 124 sales and aftersales outlets in the UK and operates under such well-known brand names as Bristol Street Motors, Farnell and Macklin Motors – said it had a healthy balance sheet of £21 million to fund future growth and in its final results mentioned that it had recently signed a new five-year acquisition banking facility of £40 million, with the potential to add another £30 million.
The record trading performance had been driven, it said, by improvements in the running of recently acquired businesses, a strong used car performance and growth in Vertu’s servicing operation, which operates with higher margins than car sales.
The company said its outlook was ‘encouraging’ with ‘robust trading’ in March and April signalling good prospects for the year ahead.
Chief executive Robert Forrester, pictured, said: ‘Since our inception 10 years ago, Vertu has remained focused on consolidating the UK automotive retail sector to grow a scaled and sustainable dealership business.
‘Today’s results, our fifth consecutive year of growth, evidences our continued delivery of this strategy.
‘Significant acquisitions have been integrated through the year and have enriched the premium mix of the franchise portfolio. Record profit before tax of £29.8m represented a 14.6 per cent increase for the group, EBITDA [earnings before interest, taxes, depreciation and amortisation] rose to over £40m for the first time and cash conversion was excellent.
‘Our strong balance sheet with net cash of £21 million together with our unutilised debt facilities provide scope for further scaling-up in due course to drive value and further enhance shareholder returns.
‘Trading up to the end of April 2017 has been strong, giving the board confidence for the future. The full year dividend has been increased by 7.7 per cent.’
On SuperUnleaded.com: Barrier Saves Rally Car From Falling Off A Cliff