Lookers set to keep growing in Yorkshire

MOTOR retailer Lookers plans to expand its operations in Yorkshire, after delivering an eighth successive year of turnover and profit growth.

Andy Bruce of Lookers

Andy Bruce, the chief executive of Lookers, said the company had been “underweight” in Yorkshire for a number of years, and was looking to grow in places like Leeds and Sheffield.

Mr Bruce told The Yorkshire Post that it had scored a “bullseye” when it recently snapped up the Nissan dealership for Leeds. He said the company was waiting for the right opportunity to come along in the region.

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In the year ended December 31, 2016, the company’s revenue increased 17 per cent to £4.3bn and the profit before tax increased by 46 per cent to £91.8m. The adjusted profit before tax increased 7 per cent to £77.1m.

The company said it was undergoing a structural change, so it can focus on growth, after its parts division was sold for £126m in November 2016 as part of this process.

It also disposed of 10 under-performing dealerships.

The company said it was focused on “the completion of future acquisitions of the right brands in the right locations in the motor division... to deliver increased shareholder value”.

Lookers said it had the balance sheet strength to complete further deals. The company said it was continuing to invest in the “multi-channel customer experience”, with a new website due to be launched in 2017.

Mr Bruce said a company’s website was often where the battle was won or lost for customers, because it acted as a “virtual showroom”.

He added: “I am pleased to announce an excellent set of year end results.

“Our profit is at record levels and has increased for the eighth consecutive year – evidence of both an expansive and a resilient business model.

“We know our strategy of having the right brands in the right locations and excellent execution is the right one – and during the year we’ve managed our portfolio of dealerships to reflect that.

“Generating shareholder value through acquisitions is one of the things we do best. We will be making more acquisitions and have the balance sheet strength to do so.

“We’ve made a good start to the current financial year and have a healthy order book for the delivery of new cars in the important month of March.

“Our strategy of acting as a consolidator – and growing organically – leaves us ideally placed for growth and increased earnings in 2017 and beyond.”

Lookers said the growth in the new car market in recent years has underpinned continued demand, as the number of cars under three years old continues to rise.

The company said that the number of new cars sold per annum in the UK has varied between 2.1 million and 2.69 million over the past five years.

Lookers’ share of the retail sector of this market is 5.5 per cent, the company said.

Analysts from N+1 Singer praised Lookers’ “positive results and confident outlook” including its capacity for mergers and acquisitions.

The analysts added: “Results today are bang in line with expectations on an underlying profit basis (ex discontinued) and ahead at the EPS (earnings per share) level courtesy of a lower tax charge.”