In a difficult market for traditional motor retailers, it seems Motorpoint’s (MOTR) 'nearly-new' proposition is gaining good traction. Motorpoint says its vehicles are typically under two years old and carry less than 15,000 miles, and the company managed to grow total sales by more than a fifth last year. This translated into a 31 per cent rise in cash profit to £23.4m, which supported a whopping 57 per cent improvement in the final dividend.
That return is still subject to approval at the annual meeting in late July, but a £10m share buyback is also under way – despite the stock’s significant appreciation over the past 12 months. But chief financial officer James Gilmour believes the shares remain undervalued, and seeing as cash flow from operations has improved from £7.4m to £12.8m year on year, he says this is a good chance to improve the stock’s liquidity.
The group also opened its 12th retail site in Sheffield in April, and chief executive officer Mark Carpenter says there are two greenfield sites currently under consideration.
Analysts at Shore Capital expect pre-tax profit of £22.9m for the year ending March 2019, giving EPS of 18.7p, up from with £20.8m and 16.8p in FY2018.
MOTORPOINT (MOTR) | ||||
ORD PRICE: | 251p | MARKET VALUE: | £251m | |
TOUCH: | 247-251p | 12-MONTH HIGH: | 268p | LOW: 124p |
DIVIDEND YIELD: | 2.6% | PE RATIO: | 15 | |
NET ASSET VALUE: | 26.4p | NET CASH: | £15.6m |
Year to 31 Mar | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
2014 | 473 | 9.5 | na | na |
2015 | 563 | 7.7 | na | na |
2016 | 729 | 16.9 | 13.4 | nil |
2017 | 822 | 11.7 | 12.7 | 4.2 |
2018 | 991 | 20.0 | 16.8 | 6.6 |
% change | +21 | +71 | +32 | +57 |
Ex-div: | 2 Aug | |||
Payment: | 14 Sep | |||