Division playing its part for Lookers

The Manchester-based firm said the parts business improved profitability in the final quarter, boosted as motorists focus on keeping their vehicles on the road in the current economic climate.

Lookers said the parts division, which works with 2,500 suppliers through 20 UK sites, made "a significant contribution to group earnings".

The group lifted its profits guidance despite a year of difficult trading conditions, which included the end of the Government's scrappage scheme, which propped up the car market during the worst of the recession.

The market is currently forecasting Lookers profits at between 31m to 34m.

Lookers said new car sales were ahead of the wider market, with like-for-like sales for the year up 3.8 per cent against a 5.6 per cent market decline.

Used car sales volumes had also recovered to 2009 levels, the company added.

Mike Allen, analyst at Panmure Gordon, said: "For 2011 we assume modest growth against 2010, but remain cautious given the uncertain consumer environment and the impact this could have on its new and used car business.

"However, Lookers is more defensive than its peers given its above average exposure to parts and aftersales and so we would expect it to fare relatively well if trading conditions did get more difficult."