Sales and profits at car dealer Lookers held steady in 2011, a creditable performance in a tough market that saw new car registrations fall 4.4 per cent to 1.94m, the lowest level since 1994. When conditions improve, the shares could well take off.
In fact, Lookers increased its new car volumes by 1.1 per cent, driven by a resurgent fleet volumes, which climbed by a quarter and offset a 9 per cent dip in retail transactions, 5 per cent ahead of the wider retail market. Lower margins on fleet sales meant profits in the new car division dipped, but that was offset by improvements in the ever steady independent parts business, and in used cars, where Lookers took market share, increasing underlying sales 2.5 per cent in a flat market. Finance director Robin Gregson said the group is in investing heavily in digital channels to help it make further inroads into the 6.7m used vehicles sold annually in the UK.
Decent new cars orders mean that in the run-up to this month's plate change sales are currently running ahead of budget. However, reflecting the uncertain consumer environment, broker Numis is holding its underlying pre-tax profits estimate at £35.2m, giving EPS of 6.7p (£33.8m and 7p in 2011).
LOOKERS (LOOK) | ||||
|---|---|---|---|---|
| ORD PRICE: | 59p | MARKET VALUE: | £ 226m | |
| TOUCH: | 59-60p | 12-MONTH HIGH: | 75p | LOW: 46p |
| DIVIDEND YIELD: | 3.7% | PE RATIO: | 9 | |
| NET ASSET VALUE: | 51p* | NET DEBT: | 20% | |
| Year to 31 Dec | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2007 | 1.68 | 23.0 | 7.48 | 3.31 |
| 2008 | 1.78 | -14.9 | -7.68 | 1.32 |
| 2009 | 1.75 | 11.5 | 2.79 | nil |
| 2010 | 1.88 | 31.1 | 5.97 | 1.80 |
| 2011 | 1.90 | 31.4 | 6.54 | 2.18 |
| % change | +1 | +1 | +10 | +21 |
Ex-div:25 Apr Payment:31 May *Includes intangible assets of £62.2m or 16p a share | ||||
