The Volkswagen emissions scandal will have its beneficiaries as well as its victims, and car retailers will be among the former if you believe the boss of Vertu Motors (VTU). For the four VW brands, which account for about 9 per cent of Vertu's sales, chief executive Robert Forrester says he has seen "no significant decline" in sales volumes or used car valuations. Indeed, he thinks vehicle recalls could actually boost Vertu's already thriving aftersales division.
In the first half of the financial year, like-for-like sales rose 3.7 per cent, with the higher-margin service area posting 6.2 per cent growth on the same basis. Aftersales gross profit also rose 14 per cent to £51m - a "real achievement", says Mr Forrester.
The company also said it had a strong September (after the period-end). Because of the new vehicle plate change, this is an important month for car retailers. Although industry reports showed a 43rd consecutive month of growth in new vehicle registrations, Vertu's new vehicle sales fell 3.3 per cent. However, margins on these sales were stronger, and the used car business showed like-for-like volume growth of 5.4 per cent.
Panmure Gordon expects pre-tax profit of £24.7m and EPS of 5.6p for the full financial year, compared with £22m and 5.1p in the year ended February 2015.
| VERTU MOTORS (VTU) | ||||
|---|---|---|---|---|
| ORD PRICE: | 66p | MARKET VALUE: | £224m | |
| TOUCH: | 66-67p | 12-MONTH HIGH: | 74p | LOW: 53p |
| DIVIDEND YIELD: | 1.8% | PE RATIO: | 11 | |
| NET ASSET VALUE: | 56p* | NET DEBT: | £32.1m | |
| Half-year to 31 Aug | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2014 | 1.08 | 12.8 | 3.0 | 0.35 |
| 2015 | 1.24 | 16.4 | 3.8 | 0.45 |
| % change | +14 | +28 | +28 | +29 |
Ex-div: 24 Dec Payment: 22 Jan *Includes intangible assets of £61m, or 18p a share | ||||
