Lookers (LOOK) found itself up against seriously tough comparative figures during this first half, following last year’s significant pull-forward effect from the change in Vehicle Excise Duty (VED) last April. It meant nearly three-quarters of full-year profits came through in the opening six months of 2017, compared with the usual 60 to 65 per cent. This year, a timely £7.6m property disposal – albeit now on sale and leaseback – helped save the day, pushing pre-tax profit up 2 per cent on a statutory basis. Excluding this, adjusted pre-tax profit actually fell 14 per cent to £43.1m, although broker Peel Hunt says this was in line with expectations as the new car market continues to struggle.
Overall, profits are still expected to grow this year, and analysts are encouraged by the strength in the September order book. Used car sales have also held up, rising 12 per cent in the opening half, while aftersales also managed to grow revenues and gross profits by 6 per cent and 7 per cent, respectively. Chief financial officer Robin Gregson also told us that the new car market has "stabilised" and that comparative figures appear "more sensible" going forward.
Analysts at Peel Hunt expect pre-tax profit of £67.2m for 2018, giving EPS of 13.4p, compared with £66.7m and 13.7p in 2017.
| LOOKERS (LOOK) | ||||
| ORD PRICE: | 106p | MARKET VALUE: | £417m | |
| TOUCH: | 105-106p | 12-MONTH HIGH: | 123p | LOW: 79p |
| DIVIDEND YIELD: | 3.8% | PE RATIO: | 8 | |
| NET ASSET VALUE: | 105p* | NET DEBT: | 13% | |
| Half-year to 30 Jun | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2017 | 2.46 | 44.6 | 9.1 | 1.41 |
| 2018 | 2.58 | 45.7 | 9.7 | 1.48 |
| % change | +5 | +2 | +7 | +5 |
| Ex-div: | 18 Oct | |||
| Payment: | 23 Nov | |||
| *Includes intangible assets of £223m, or 57p a share | ||||
