Record profits at Lookers have prompted the car dealer group to return £ 4 million in furlough support, although its restored dividend is almost equal to the amount of relief at last year’s business rate.
Lucarians have made their best gains due to the lack of new cars, as global shortages of microchips, and declining demand from people who are wary of public transport, have led to significantly higher car prices. Cost-cutting has also led to higher margins, including the closure of 27 showrooms and 1,500 unnecessary jobs during the epidemic.
Lucar unveiled a pre-tax profit of £ 90 million for the year to the end of December, up from £ 1.5 million a year earlier, and a loss of £ 45 million the previous year, while acknowledging that it had outperformed its profits for three. Year-to-year sales rose 9 percent from £ 3.69 billion in 2020 to £ 4.05 billion last year.
Its CEO Mark Raban said: “It has been difficult for Covid and the company for many years with our own problems, but we are moving forward with speed.”
Lucas is one of the largest British car retailers with 6,500 employees. It plunged into an accounting crisis two years ago and came under criminal scrutiny for regulatory investigations into fraud and misappropriation.
Raban, 55, an industry veteran, joined the business as finance chief before being promoted to chief executive in February 2020, four months before the boardroom clearance. The company’s fortunes took a turn for the worse in January when Constellation Automotive, the owner of webuyanycar.com, bought about 20 percent of the shares, sending its shares upside down in takeover speculation.
Lucas Boss says he is “proud and delighted” to return the £ 4.1 million furlough support the group received in the first half of last year, and to justify not returning the £ 9.8 million business rate relief because it was “not supported”, we claim, applied only by the council. Done. We were closed for the first quarter and we weren’t designated as the required retail so we think that’s true. “
Lookers claimed £ 45 million from the government in 2020 but have since risen to much stronger positions from the epidemic, such as Vertu and Pendragon, its dealership colleagues. It said its improved financial performance meant it was debt-free and paid investors a 2.5pa-share dividend, equivalent to a আ 9.3 million payout.
Analysts at Pill Hunt say: “Dividends have been restored, the balance sheet is physically stronger than the pre-Covid 19 and the current trading conditions are stronger, with the underlying profit being exceptionally strong compared to the previous year.”
Raban says Luker’s new strategy has paid off and his investment in a cosmetics repair business, which fixes alloy wheels, small dents and scaffold bumpers, will continue to be profitable even as the automotive industry moves toward electric vehicles. It is adding two new five-acre second-hand car sites as part of its Cube Concept, which will include a cafe on campus.
The business warned that it was facing a shortage of new cars, with Raban saying the war in Ukraine could exacerbate the problem because there were too many electrocomponents and car wires being made. Drivers have been waiting six months to a year for new cars, while the industry has about 500,000 fewer vehicles than normal, meaning the price of new cars has risen by about 15 percent. Shares of Lucar fell 4p, or 4.2 percent, to 92p, with the company valued at about 6 376 million.