Vertu Motors Plc (LON:VTU) is the topic of conversation when Mike Allen chats with DirectorsTalk about its latest AGM statement. Mike talks us through the key points from the update, trading themes, how this might affect the forecast and Mikes view on the company as an investment.
During the four month period to 30 June 2018 the Group has continued to deliver profits in line with the Board’s expectations.
Highlights
· Trading in line with Board’s expectations
· Like-for-like revenues and profits increasing in the high margin aftersales segment
· Growth in like-for-like revenues and gross profits from used vehicle sales
· Growth in like-for-like new retail vehicle sales volumes of 2.1%, significantly outperforming market – SMMT registrations down by 4.4%
· Fleet and commercial volumes ahead of market registrations with healthy growth in vans, and a slowdown in fleet activity as some customers hold off purchases ahead of new emissions regulations (Worldwide Harmonised Light Vehicle Testing Procedures) in September 2018
· Lower new retail, fleet and commercial vehicle margins were experienced as Manufacturers continue to react to currency weakness
· Recent Hughes Group Holdings acquisition integration started well
· Further growth opportunities being assessed
· Continued focus on capital allocation
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Increase (decrease) period-on-period |
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Total |
Like-for-like |
SMMT UK Registrations |
|
Group Revenues |
+5.7% |
+7.0% |
– |
|
Service Revenues* |
+5.3% |
+6.5% |
– |
|
|
|
|
|
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Volumes: |
|
|
|
|
Used retail vehicles |
+4.5% |
+6.0% |
– |
|
New retail vehicles |
+0.2% |
+2.1% |
(4.4%) |
|
New Motability vehicles |
(9.8%) |
(8.7%) |
(2.4%) |
|
New fleet cars |
(6.2%) |
(7.0%) |
(8.1%) |
|
New commercial vehicles |
+7.0% |
+6.9% |
(2.9%) |
* includes internal and external revenues
