Lookers sees median selling prices for new cars up nearly 13%

Dealership group Lookers has raised earnings expectations after average selling prices for new cars rose nearly 13 percent last year.

Consolidated revenue rose thanks to higher new car costs for drivers, offsetting a 5.8 percent year-on-year decline in new and used car sales.

The group strengthened its vehicle finance sales and saw an increase in profit margins across its leasing business in 2022.

The London-listed company’s annual sales rose to £4.3 billion from £4.1 billion in 2021.

Underlying pre-tax profit fell to £82.7m in the 12 months to 31 December, down from a record £90.1m a year earlier.

The company’s top executives said last year’s performance was primarily driven by “market superiority and cost control” in new and used vehicles.

Lookers directors proposed a final dividend of 2p per share, a 20 per cent increase from 2021.

The group had net cash of £66.5m at year-end and a property portfolio with a net book value of £290.5m.

Looking ahead, Lookers reported an “excellent start” to the first quarter with underlying pre-tax profit ahead of 2022. The group said it was poised to make acquisitions to strengthen its portfolio.

It’s also moving ahead with plans to develop a new “destination center” for used cars called the Lookers Car Hub. The standalone multi-franchise used car offering is expected to open in Middlesbrough in the final quarter of this year.

Lookers also said it had continued to generate cash in recent months, with net cash at 31 March of £93m.

However, the board said it is keeping a close eye on ongoing trade headwinds, including economic uncertainty, inflationary pressures and both supply and logistics issues.

Despite these challenges, the board’s expectations for underlying profit before tax for 2023 are now ahead of its previous guidance.

“I am pleased to report another excellent performance against a backdrop of material supply disruptions, inflation and rising interest rates,” said Chief Executive Mark Raban.

“We’re keeping a close eye on the pressures consumers are facing and discretionary spending.”

Lookers shares were up today and rose 1.88 per cent, or 1.60p, to 86.60p this afternoon after falling around 9 per cent over the last year.

UK new car sales up over 18%

The UK new car market grew for the eighth consecutive month in March – and electric vehicles saw a record month of demand, latest industry figures released today showed.

Registrations grew 18.2 percent year-on-year, the Society of Motor Manufacturers and Traders (SMMT) confirmed.

Battery electric vehicle (BEV) deliveries hit a record monthly high of 46,626, up 18.6 percent, the figures show.

This was the best performance of “new license plate month” since before the pandemic – with March and September traditionally the busiest times for car dealers due to the arrival of the latest license plates – but industry insiders warn the “positive” headline numbers are “masking”. a worrying decline in public demand.

A total of 287,825 new vehicles hit our roads last month – an increase from 243,479 in March 2022.

Mike Hawes, Chief Executive of SMMT said: “The new record month of March usually sets the tone for the year so this performance will inspire more industry and consumer confidence.

‘After eight consecutive months of growth, the auto industry is recovering, bucking broader trends and supporting economic growth.’