Auto Trader (AUTO) overcame well-documented challenges in the domestic car market to lift its average revenue per retailer by 7 per cent to £1,951, as improvements across the business offset a small decline in paid retailer stock.
The auto website is benefiting from initiatives including the monetisation of its vehicle check service and the introduction of text chat, which is available free of charge to dealers subscribing to a car, van or bike selling package. Peel Hunt analysts described the 1 per cent uptick in the number of retailer forecourts to 13,316 as “unexpected”, with the increase driven by smaller retailers joining Auto Trader - representing a glimmer of hope for the ailing car industry.
In another positive development, Auto Trader’s on-site physical car stock rose by 10 per cent. This was driven by a surge in new cars, with an average of 33,000 new cars advertised on the site compared with just 3,000 in the same period last year.
Peel Hunt forecasts full-year 2020 pre-tax profits and earnings per share of £251.8m and 22p, respectively, rising to £277.9m and 24.8p in 2021.
| AUTO TRADERS (AUTO) | ||||
| ORD PRICE: | 535p | MARKET VALUE: | £4.95bn | |
| TOUCH: | 534.6-535.2p | 12-MONTH HIGH: | 607p | LOW: 412p |
| DIVIDEND YIELD: | 1.3% | PE RATIO: | 24 | |
| NET ASSET VALUE: | 10.3p* | NET DEBT: | £338m** | |
| Half-year to 30 Sep | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2018 | 177 | 115 | 9.78 | 2.10 |
| 2019 | 187 | 128 | 11.13 | 2.40 |
| % change | +6 | +12 | +14 | +14 |
| Ex-div: | 02 Jan | |||
| Payment: | 24 Jan | |||
| *Includes intangible assets of £317m, or 3.4p a share **Excludes lease liabilities of £10.2m | ||||
