7:41 am, October 13, 2023
Cotswold Motor Group – which operates a gigantic £20m BMW and Mini dealership in Cheltenham – saw pre-tax profits rise to £7.8m in an ‘exceptional’ 2022.
The results were a 44% increase on the previous year’s £5.4m earnings as the BMW, Mini and Motorrad specialist also saw revenues surge.
Cotswold Motor Group Ltd operates BMW, Mini and Motorrad bike showrooms from a huge site in Cheltenham, as well as BMW and Mini sales in Hereford and an approved bodyshop in Tewkesbury.
The Cheltenham site was opened in May 2017 and displays cars and bikes over four storeys.
In its annual accounts, just published at Companies House, it said the results were largely driven by improved gross profit per unit sold – up 58% compared with 2021. It also said it brought in revenues of £214m in the year compared with £179m the year before.
Director Andrew Hulcoop said in his statement: ‘The volumes have not recovered from pre-Covid years albeit the shortage has driven much improved profitability.
‘Whilst expenses were up as a result of increased salaries and other operating costs, the overall profit from new cars was as good as it’s ever been.’
As a result, the group paid out a dividend to shareholders of £8.3m during the year. In 2021 it paid £1.9m to shareholders.
Cotswold Motor Group said expenses, before interest charges, were up £2m in 2022 driven by increased salary costs and a ‘huge hike’ in utility bills. Interest charges rose £300k.
New car sales were up 10%, but used car sales and corporate sales both fell 3%. Aftersales revenue grew £1.1m during the year – an increase of 13%.
The dealer added: ‘The group continues to invest in facilities with the purchase of an adjoining piece of land totalling 1.3 acres. The land is currently used for staff parking and the plan is for this to continue but it does give opportunity for further expansion in the future.’
Directors said they forecast that used car stock would be hard to come by late in 2022 and into 2023, so decided to increase the amount of cars it purchased, upping stock held from £15.6m to £20m.
‘Whilst this is considerably higher than the previous year, we envisaged stock would be hard to come by at the start of 2023 due to demand and therefore chose to stock up when the stock was available to us,’ added the firm.
‘At the time of writing this report, the stock value has fallen to close to £13m. Our strategy was correct and we have had a fantastic start to used car performance in the first quarter of this year.
‘Acquiring used car stock is as big a challenge as it’s ever been and the market shows little sign of this changing in the short to medium term.’
The group said new car shortages, though, continue to present ‘a challenge and an opportunity’.
The firm added it continued to have a ‘very strong’ relationship with its manufacturer partners, with its Cheltenham Mini site winning the car maker’s Used Car Retailer of the Year and ‘much coveted’ overall Mini Retailer of the Year awards.
As of the end of 2022, the group employed 333 staff with the highest-paid director receiving £256k. The firm will pay a £1.5m tax bill.
Cotswold Motor Group placed 59th in last year’s Car Dealer Top 100 list of most profitable dealer groups. The 2023 Car Dealer Top 100 will be out soon.
Main image: Google Streetview
