Trading volumes for Motorpoint (MOTR) started to pull-back a fortnight earlier than the formal lockdown measures at the end of March, so a 1 per cent fall in gross profit, in addition to a 16 per cent increase in operating cash-flow, point to a stable, if unspectacular, trading performance.
The underlying margin increased by 30 basis points and the cash conversion rate was buoyed by improved stock management processes. The auto dealer has kept a tight rein on working capital since the widespread closure of its physical sites, including a significant reduction in debtors. By the period-end, Motorpoint had drawn £10m from its revolving credit facility, while arranging an additional overdraft facility to provide enhanced short-term liquidity. Additional stability has been provided by municipal rates holidays, a sizeable reduction in boardroom pay, and claims under the Coronavirus Job Retention Scheme.
Liberum anticipates trading profits of £28.1m for the March 2021 year-end, leading to adjusted EPS of 23p, rising to £30.7m and 25.2p in FY2022.
| MOTORPOINT (MOTR) | ||||
| ORD PRICE: | 240p | MARKET VALUE: | £ 216m | |
| TOUCH: | 227-244p | 12-MONTH HIGH: | 324p | LOW: 170p |
| DIVIDEND YIELD: | 1.1% | PE RATIO: | 15 | |
| NET ASSET VALUE: | 22p | NET DEBT: | £44.6m* | |
| Year to 31 March | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2016 | 0.73 | 16.9 | 13.4 | nil |
| 2017 | 0.82 | 11.7 | 12.7 | 4.2 |
| 2018 | 0.99 | 20.0 | 16.0 | 6.6 |
| 2019 (restated) | 1.06 | 22.9 | 18.1 | 7.5 |
| 2020 | 1.02 | 18.8 | 16.4 | 2.6 |
| % change | -4 | -18 | -9 | -65 |
| Ex-div: | - | |||
| Payment: | - | |||
| *Includes £45.4m in lease liabilities. | ||||
