Lookers expect record profit for the year
Lookers has announced a trading update for the financial year to 31 December 2021 which highlighted:
· expectation of record underlying profit before tax ahead of company compiled market consensus of £82m;
· strong balance sheet, with net cash (*) of approximately £8.0m as at 31 December 2021 (2020: net debt £40.7m) and property with a book value of £303.9m (equivalent to 77.8p per share) as at 30 June 2021; and
· intention to continue to invest in the business and restore dividends alongside the full year 2021 results.
The Group has had an exceptional year in 2021 and is starting 2022 with an excellent new car order bank. However, given ongoing global supply chain disruptions, uncertainty as to the availability of new vehicles and the sustainability of used car margins at current levels, the Board believes it is right to remain cautious. The Board is also conscious of general inflationary pressures and increased utilities costs, and is managing these risks through a continued focus on working capital management and tight cost control. The Board is confident that the Group remains well positioned to capitalise on the opportunities ahead and achieve its financial expectations.
Mark Raban, Chief Executive Officer said: "2021 was an exceptional year for Lookers and we now expect to beat our previous estimates with record profit for the year. This is a great achievement by the whole team in a year which brought many external challenges, including Covid and vehicle shortages, demonstrating the strength of our proposition. With net cash at the year end, we have a strong balance sheet and good capacity to invest in future growth opportunities.
“There are many structural changes which are creating opportunities in our market including evolving consumer behaviour, electrification, and changing relationships with our brand partners. The Board and Executive have been refreshed and we are well progressed with a major review both to improve our operational performance and to future proof our revenue streams through a number of strategic growth opportunities. We have outlined our main areas of focus in our update today and are excited about our ambition and aspiration to become The UK's Leading Integrated Automotive Retail and Services Group."
(*)Net Cash is before taking into account year end accounting adjustments including cash in transit)
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