|
Vertu Motors PLC on Tuesday announced a strong half-year trading performance but warned of uncertainty in the macro-environment.
The Gateshead, England-based car dealership with 160 sales and aftersales outlets across the UK warned of ‘uncertainty around vehicle supply and the macro-environment for consumers which is likely to be affected by rising energy costs and inflation’.
The update comes ahead of the release of their results for the six-month period ending August 2022.
Vertu currently benefits from below market rate electricity costs due to a fixed contract set to expire at the end of September.
The company said it is ‘very focused on reduced energy usage where appropriate and an energy purchasing strategy has been developed which includes the sourcing of off-grid energy solutions in order to manage the group's exposure to energy market price volatility risks’.
Continued dislocation in supply chains has constrained the supply of new vehicles in the UK. Used vehicles also face supply constraints due to a decline in like-for-like used car volumes.
Additionally, operating expenses have increased year-on-year as a consequence of rising costs and the removal of government support.
Despite this, gross profit generation is ahead of last year, despite a decline in volumes, due to stronger margins.
The ‘high-margin’ aftersales departments have also delivered revenues ahead of prior year levels.
The company expects profitability to be weighted more to the first half of the financial year but that trading performance for the full financial year will be in line with current expectations.
Shares in Vertu were trading 0.5% lower at 46.50 pence each in London on Tuesday afternoon.
Copyright 2022 Alliance News Limited. All Rights Reserved.
|
