LONDON (ShareCast) - Pendragon Group’s shares advanced after raising full-year profit expectations on the back of strong second half results.

In a trading statement, the operator of franchised motor dealers in the UK reported an improved performance due to strategic initiatives and improved market conditions.

The firm said Britain’s car dealers have been among the first to enjoy the benefits of the economic recovery.

“The group is pleased with progress across all areas with gross and departmental profit ahead in each of our key sectors of aftersales, used and new,” it said.

While the outlook to next year remains promising, the company expects that aftersales recovery, driven by new car sales, will continue to be modest and the used car market will remain broadly flat.

In the used sector, the group's like-for-like used units increased by 9.7% with year to date growth of 8.9%.

New retail registrations increased by 16.7% and the total market increased by 10.8%.

The group's balance sheet remains in a strong position following the comprehensive refinancing and debt reduction.

“Profitability in 2013 is expected to be materially ahead of expectations for the full year and we are cautiously optimistic about the prospects for 2014,” Pendragon concluded.

Sales rose 3.90% to 40p at 15:29 on Monday.

RD

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