LONDON (ShareCast) - (ShareCast News) - Franchised motor dealer operator Pendragon posted its results for the year to 31 December on Tuesday, with like-for-like gross profit rising 4.9% to £548.7m, while like-for-like operating profit grew 2% to £104.3m.
The London-listed firm reported underlying profit before tax of £75.4m, up 7.6%, while it's total profit before tax was down 7.6% to £73m.

Total earnings per share were off 24% at 3.8p for the period.

The company said its IT and software division Pinewood established its first European customer user base during the year, and increased its operating profit by 14.9%, while used vehicle revenue was up 9.5% on a like-for-like basis - or 5.6% on a reported basis - as Pendragon continued to increase its market share.

Aftersales revenue was up 7.3% on a like-for-like basis - or 4.1% as reported - which the board said was a result of market tailwinds and its initiatives, while new vehicle revenue was up 3.1% on a like-for-like basis and down 1.4% on a reported basis.

Pendragon's underlying operating margin stood at 2.2%, which was in line with the prior year.

"Pendragon is leading the evolution of automotive online retailing," said chief executive Trevor Finn.

"Our underlying profit before tax has increased by 7.6% in the year as our growth continues.

"The group has doubled underlying profit before tax in four years as a result of our clear strategy of offering choice, value, customer service and convenience."

Finn said future growth would be driven by the board's initiatives, its investment in additional physical capacity for used car sales and by its strategic advantages in IT and intellectual property.

"We believe that we can achieve at least double digit growth in used revenue in 2017 and our aspiration over the next five years is to double our used vehicle revenue.

"In order to test this, during the final quarter of 2016 we invested in inventory and adjusted our algorithms and marketing initiatives with a view to driving growth in used vehicle activity levels to test the capacity of our current footprint."

Finn said the early results of that were very encouraging.

"Our growth in used vehicle revenue on a like for like basis in January 2017 exceeded the increase required to achieve our growth aspirations.

"We anticipate our performance for 2017 will be in line with expectations."

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