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Lookers PLC on Wednesday hailed a record year and reinstated its dividend, though it warned of cost pressures and scarce new car supply in 2022.
The Cheshire-based car dealer said revenue in 2021 rose 9.5% to £4.05 billion from £3.70 billion. Pretax profit surged to £90.0 million from £1.5 million.
‘2021 was a record year for Lookers. We navigated another year of limited new vehicle supply and Covid-19 disruption. We have reported excellent profits and cash generation, through strong used car margins, continued focus on costs and the unstinting efforts of our people. We have successfully moved back to a net funds position in the business and have a strong balance sheet, underpinned by our property assets, supporting our investment capacity to grow the business,’ Chief Executive Mark Raban said.
Lookers its reinstated dividends with a 2.5 pence per share annual payout. It will grow its payout ‘progressively’, the company said.
It was a successful 2021 and although 2022 has started decently, Lookers warned of concerns to be mindful of.
Raban said: ‘The business and our customers face some uncertainties in 2022. Trading in Q1 has been strong despite new vehicle supply remaining tight. The current crisis in Ukraine and significant cost of living increases will put pressure on consumer sentiment and disposable incomes. However, the group is looking forward to the future with confidence.’
An ongoing semiconductor shortage will also hit new car supplies in 2022, Lookers cautioned. Inflation will lead to ‘material cost increases’ for the company.
It did, however, explain that ‘momentum of last year has continued into trading’ in the first quarter of 2022.
Lookers shares were 2.4% lower at 93.70 pence each in London on Wednesday morning.
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