Vertu Motors scores record annual revenue amid rising vehicle prices
Vertu Motors posts highest annual sales ever amid rising vehicle prices and recent acquisitions
- Vertu Motors achieved a turnover of £4 billion for the 12 months ended February
- The Gateshead-based company said its pre-tax profit beat expectations
Vertu Motors posted record sales last year thanks to rising vehicle prices and acquisitions over the past two years.
The car dealership, which owns the Bristol Street Motors chain, posted revenues of £4bn for the 12 months ended February, an increase of almost £400m on the previous year.
Commerce benefited from ongoing supply chain constraints, due in part to a shortage of semiconductors, which drove up the price of new and used retail vehicles sold by the company.
Record result: Vertu Motors achieved £4bn revenue for the 12 months ending February, an increase of nearly £400m on the previous year
Customers spent on average nearly £20,000 for every second-hand bike they bought and £24,128 for a new car, an increase of 12 per cent and 10 per cent respectively on the previous 12 months.
The healthy increase in prices offset the flattening of unit sales caused by falling demand for used vehicles that Vertu blamed on tighter market supply levels and a rebalancing between volume and margin.
Vertu said the £183.2 million revenue growth was driven by acquisitions completed since March 2021, including Yeovil-based Helston Garages, its largest ever acquisition.
Buying the Helston family business increased the company’s reach in South West England from four dealers to 32 and added Ferrari and Volvo to its portfolio.
Just prior to taking over the group, Vertu became the UK’s largest seller of BMW motorcycles when it acquired a pair of Yorkshire dealers from the Saltaire Motor Company.
The Gateshead-based company credited the acquisitions as helping improve trading profits in March and April from last year despite significant inflationary pressures and interest rates.
Bosses now expect full-year trading to be in line with current market forecasts, supported by ongoing supply challenges that keep used vehicle prices and margins high.
“I am pleased to report that the year-end trading result is encouraging and gives confidence for the year ahead,” said CEO Robert Forrester.
He added: “The company is in a healthy financial and operational position to continue to develop and take advantage of economies of scale as the consolidation of the industry continues.”
The company also stated that adjusted pre-tax profits beat expectations, although they fell by more than half to £39.3m, mainly due to the cost of acquisitions and rising staff salaries in response to difficulties in filling vacancies and the bump in the national minimum wage.
It has therefore decided to recommend a 40p increase in final dividend to 1.45p per share, alongside a £3m share buyback programme.
Vertu Motors Shares closed 3.1 percent higher on Wednesday at 59.8 pence, meaning they’ve grown about 125 percent over the past three years.