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Vertu Motors posts strong set of financial results for the last year – but effects of lockdown are not yet reported

Time 11 months ago

Vertu Motors has released a strong set of annual results which shows profit of £23.5m – but the period doesn’t include the lockdown.

The annual accounts, released this morning to the Stock Market, cover the period up to the end of February 2020, before dealers closed their doors in March.

Revenue was up by £82.3m to £3.1bn in the year – representing growth of 1.2 per cent – as the group added 12 outlets to its portfolio and three new franchises.

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Last year, the group made a profit of £23.7m. This year’s figure of £23.5m is down slightly, but includes costs and losses of £700,000 in relation to recent acquisitions.

In total, Vertu Motors has 133 sales and aftersales outlets in the UK.

This looks set to increase as the company states it clearly has a strong position to ‘take a larger role in the sector through consolidation and growth opportunities’ and that it ‘has the ambition to do so’.

The group reported ‘stable’ used car sales and margins, despite what it described as ‘volatility’ in the first half of the year.

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Aftersales performance was ‘excellent’ with growth in the profitable area up 4.6 per cent delivering a 5.9 per cent gross profit margin.

CEO Robert Forrester said: ‘The year to February 29, 2020, was robust for Vertu, but now the COVID-19 crisis and impact are clearly the focus.

‘I have spent the best part of 20 years getting people into motor dealerships and the last two months effectively keeping them out.

‘We entered the lockdown with a strong balance sheet, minimal use of used car stocking loans and excellent relationships with our banks, all of which means we have sufficient liquidity to weather this crisis.’

The group experienced growth in fleet and commercial revenue of 5.3 per cent which added £5.6m gross profit to the company’s performance.

Despite this, the group will not be paying a dividend.

The full results were delayed in April in order the give the company enough time to ‘prepare and review financial information in the current climate’.

Forrester added: ‘Due to the progress made in FY20, our financial strength, omnichannel capabilities, trusted relationships with manufacturers and strong team and culture, we will emerge from this crisis with an improved market share as the competitive landscape evolves and attractive consolidation opportunities emerge.’

Vertu said its banks remain supportive and it has a strong balance sheet.

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It added it meticulously planned to open dealerships again on Monday in a safe and socially distanced way.

Forrester added: ‘The health, welfare and safety of our colleagues and customers is of vital importance, and I would like to say how proud I am of the entire Vertu team which has responded rapidly and responsibly in this crisis, temporarily closing retail outlets quickly and safely and keeping vital service capability in the vast majority of group outlets open for the vehicles of key workers and essential organisations.

‘I would like to thank all our colleagues for their hard work and support at this time, and I want to do them and their hard work justice by making this announcement not just about COVID-19.’

James Baggott

James is the founder and editor-in-chief of Car Dealer Magazine, and CEO of parent company Baize Group. James has been a motoring journalist for more than 20 years writing about cars and the car industry.

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