Vertu Motors on track despite weaker used car sales

30th Aug 2023 07:40

(Sharecast News) - UK car dealership group Vertu Motors said it remains on track for the full year after a solid first half, despite used vehicle sales being hit by rising interest rates.

The company, which runs a total network of 189 sales and aftersales outlets, said profits for the six months to 31 August are above last year, helped by last year's acquisition of West Country-based Helston Garages, which operates 28 sales outlets.

The company said it has seen like-for-like volume growth across its new retail, Motability, fleet and commercial vehicle channels, but used vehicle LFL volumes were down 6.3%.

"Rising interest rates have meant that the group has this year been unable to run its popular 0% finance offers on used vehicles during event periods as it did in the prior year," Vertu said in a statement. "This change in approach, along with a continued lack of supply of used vehicles has driven the reduction in the number of like-for-like used vehicles sold."

Meanwhile, the company's aftersales operations have performed well, with strong demand for its high-margin repair and service offerings.

Chief executive Robert Forrester said: "The board remains optimistic for the future, we anticipate that full year results will be in line with current market expectations, and we are excited about the opportunities our enlarged portfolio will create for Vertu Motors."

The stock, which has jumped 32% since the start of 2023, was more or less flat at 69.2p in early trading on Wednesday.