Car dealer group operation Inchcape Retail rebounded from £76.4 million pre-tax loss to deliver profitability in 2021 financial results.
The AM100 car retail group, part of Inchcape PLC, delivered a pre-tax profit of £6.54m as turnover rose by 22.7% to £1.33 billion (2020: 1.08bn) in the 12-month period to December 31, 2021, documents published via Companies House revealed today (January 9).
Gross profit margins increased to 12.6% (2020 10.4%) as restricted used car supplies across the sector triggered higher margins during a period which brought about the business’ launch of a new bravoauto used car retail division.
The period also followed a restructure of its operations, with December 2020’s sale of 12 BMW, Mini and BMW Motorrad franchises from the Cooper division to Vertu Motors bringing its total disposals to 20 dealerships in two years.
Later that year it continued to shed sites through the sale of its Jaguar Land Rover (JLR) dealership in York to Lloyd Motor Group, however.
Former chief executive James Brearley – previously the subject of a dealer profile feature in AM – left the business in November 2021, meanwhile, after a board reshuffle introduced George Ashford and Katie Martin-Hickey to the business.
Inchcape Retail’s 2021 recovery marks a significant turnaround from a COVID-19 impacted 2020 trading period in which pre-tax profits slumped by 896.2% as the group claimed over £11m in support from the UK Government’s coronavirus job retention scheme (CRJS) to furlough staff.
The group acknowledged in its results statement that market headwinds continued to cloak the months ahead in a degree of uncertainty.
It highlighted the uncertainty presented by any escalation of the conflict between Russia and Ukraine alongside the anticipated reduction in turnover that will result from OEM partners BMW/Mini and JLR moving to agency model retail agreements in comments on its future trading.
Commenting on its continued operations in 2022, however, the business stated: “The Company’s 2022 performance up to the date of signing these financial statements was ahead of its forecast with an increase in profit compared to the same period in 2021. There remains uncertainty around new vehicle supply availability for the remainder of 2022and the start of 2023, however to-date, this has been offset by an increase in selling prices and improved gross margins.”