Lookers Announce Profits Above Expectations

Lookers first-half profit before tax above expectations is announced at  £49.9 million. The figure is down fractionally on the 2021 H1 figure of £50.4m. Last year’s figure however included £12.7m in government support. Turnover for the group was ahead of H1 2021 at £2.23bn.

Lookers had previously stated it expected to announce underlying profit before tax for H1 of £45m.

CEO Mark Raban said: “Our first half financial performance was very strong. It fared well against an exceptional comparative period despite ongoing inflationary pressure and vehicle supply disruption. We have also made excellent progress with our strategic priorities.

Self Help Efficiencies

“We are focussed on operational ‘self-help’ efficiencies across the business and continue to pursue exciting growth opportunities including new brand partnerships. Whilst mindful of the pressures facing consumers, we are confident in our strategic direction and retain our expectations for the remainder of the year.”

Lookers attributed the strong performance to increased used and aftersales revenues with a “material improvement in vehicle gross profit”.

Lookers has also opted to repay its business rates relief of £1.5m in Q1 2022.

The group also said it was aiming to take on “a number of new brands and EV only entrants”.

Raban added: “Trading during July and August has been in line with expectations. Margins remain at H1 levels, and the group continues to maintain a strong order book for the remainder of 2022. Focussing on ‘self-help’ initiatives within our operations, we have added materially to the profitability of the business. Alongside this we launched the ‘You Choose’ brand campaign which involves investment in significant brand awareness amongst consumers.

Continued Investment

“Notwithstanding the material cost headwinds being experienced and the wider macroeconomic uncertainties, the Group remains well positioned to deliver on its strategic priorities for the remainder of 2022 and beyond. We will continue to invest in our people, digital capabilities, building our OEM relationships and bring new EV entrants to the UK. All investments will be made in line with the strict rules of our capital allocation policy.

The Company will update on OEM/volume supply later in the year after the important September new car registrations.”

Lookers has also appointed a new non-executive director Sue Farr. Sue will chair the remuneration, audit and risk and nomination committees.