Thursday, February 25, 2010
Pendragon back in profit
Pendragon, the UK's biggest dealer group, has reported pre-tax profits of £1.3 million in 2009 in comparison to a £194 million loss in 2008.
The group reduced its net debt by £41.9 million last year and cash generated from operations rose from £53.6 million in 2008 to £93.3 million in 2009.
The group now operates 276 franchises points.
Trevor Finn, Pendragon chief executive, said: "The group has successfully dealt with the most challenging market conditions experienced since the nineties.
“We acted swiftly to implement significant cost saving and debt reduction actions. During 2009 we concluded a successful refinancing to secure the long term future of the group.
“Consequently, we are now in sound shape and have returned to profitability. While we anticipate our market will remain difficult in 2010, we are well positioned to focus on the profit opportunities that will drive our core business forward."
Pendragon closed 26 franchise points in 2009 and it took headcount reductions to help get the business back into shape and able to return to profit. The closure of the sites and 879 redundancies involved set the group back £10.7 million overall last year.
Stratstone, Pendragon’s premium car sector business, posted operating profits of £18.6m in comparison to a £2.5 million operating loss in 2008.
The group’s volume franchise business, Evans Halshaw, saw an operating profit of £14.2 million in comparison to a £6.1 million loss last year.
Chatfields, Pendragon’s independent truck and van retailer, saw operating profits fall from £3.6 million in 2008 to £1.2 million last year.
Outlook
Finn said: "We expect the used car market to remain stable and aftersales to be resilient. In 2010 we therefore expect our used car margins to remain solid and aftersales to benefit from growth opportunities.
"We concur with the SMMT view that the new car market will remain subdued for the next 12 months. We believe a gradual improvement will then be seen. We have taken actions which give us confidence that we will improve the performance of the Group in 2010 despite the anticipated difficult markets. The Group is now well placed to take advantage of markets when they recover and is currently trading in line with our expectations."
