Lookers enjoys credit boom as it looks to continue on acquisitions trail
Lookers said a boom in cheap credit was behind a hike in half-year profits as it looks to continue on the acquisitions trail.
Britain’s fourth-largest motor retailer has seen pre-tax profits jump 36 per cent to £40million, accompanied by a 10 per cent increase in the interim dividend to 0.97p a share.
On the back of improving conditions in the UK car market, Lookers enjoyed a record performance in new and used vehicle sales, with revenues touching £1.6billion, up 29 per cent, for the first six months of the year.
Up: Lookers reported a 36 per cent rise in pre-tax profits to £40million
Cheap credit, available to buyers through its personal contract plan, has funded almost four in five of new car purchases.
Anticipating strong tailwinds in used car sales, the firm has set its sights on future growth.
Despite the acquisition of Colborne Garages in March, net debt has remained steady and Lookers has renewed its term loan facilities to include an extra £30million to fund potential future acquisitions.
Chief executive Andy Bruce, explained that Lookers (up 1p to 135p) was now ‘well placed to take advantage of further growth opportunities’.
Analysts were upbeat, noting the firms strong track record of creating value from firms it has bought, pointing to scope for further takeovers in the UK car market.
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