Vertu Motors suffers in weak new car market

Vertu Motors, the automotive retailer, expects trading performance for the year ending 28 February 2018 to be moderately below current market expectations, following further declines in the new car market.

In the four months to 31 December, like-for-like group revenues slipped by 0.1% with total revenues down 2.4%.

Like-for-like volumes in used retail vehicles fell 3.2%, reflecting a more subdued consumer environment and a substantial reduction in the sale of pre-registered vehicles as supply to the UK of new vehicles tightened.

Like-for-like volumes in new retail vehicles fell by 13.2%.

New fleet car like-for-like volumes rose 12.4%, while commercial vehicles increased 0.4%.

Robert Forrester, chief executive of Vertu Motors, said the group has experienced tougher trading conditions compared to recent years as Sterling's devaluation places pressure on new car pricing and supply.

This coincided with a slightly softer general consumer environment in the run up to Christmas.

"The group continues to be very well positioned to take full advantage of weaker markets which, in previous sector downturns, have proven to provide opportunities. At the year-end we expect to have a strong balance sheet underpinned by a property-rich asset base with low levels of debt. We fully intend to continue our share buy-back programme as we believe this creates value and does not impact our ability to undertake value-enhancing investments in the business or undertake suitable acquisitions," Forrester added.