Pendragon launches review as it posts loss amid 'challenging' conditions
By Michele Maatouk
Date: Wednesday 17 Apr 2019
(Sharecast News) - Car dealership Pendragon said on Wednesday that it had launched a review of its operations and financial prospects as it reported a loss for the three months to the end of March 2019.
Total revenue during the period was up 1.2%, with like-for-like growth of 4.6% and group LFL new revenue growth of 6.3%.
However, Pendragon said "challenging" trading conditions meant there was a reduction in margins in new, used and aftersales, leading to a 5.4% decline in LFL new gross profit, a 1.6% drop in LFL used gross profit and a 5% slide in LFL aftersales gross profit.
"This performance, combined with both a higher level of operating costs and increased losses within Car Store, arising from the ongoing development and maturation of the business...resulted in an underlying loss before tax of £2.8m," the company said.
This is around £10m lower than Pendragon had expected for the period. It comprises about £7m from the net impact of higher revenue and lower margins, £2m of additional operating costs and £1m from the lower-than-expected Car Store performance.
In light of the update and given the recent appointments of Mark Herbert as chief executive and Mark Willis as chief financial officer, the group has begun a review of its operational and financial prospects, the results of which will be revealed in June.
At 0920 BST, the shares were down 5.6% to 23.74p.
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10 Lower Thames St,
London EC3R 6EN