Lookers gets sales boost amid accounting probe

Troubled Altrincham-based car dealership Lookers plc — whose shares have been suspended amid an accounting investigation — said on Friday its third-quarter sales were 13.6% higher than the same period last year.

“On a like-for-like basis, the group sold over 42,000 new retail and used cars, 13.6% higher than the same period last year,” said Lookers.

“This growth was fuelled by the release of pent up demand from over two months of closure and the ongoing trend of private car use instead of public transport.

“We have also had a good customer response to our improved, simplified and more digitised sales process, which has helped boost our performance.”

On its financial statements, Lookers said: “We are continuing to work with our auditors to finalise the accounts for the year ended 31 December 2019 and the interim results for the 6 months ended 30 June 2020.

“We currently expect both the 2019 results and the interim results to be published in November 2020.

“As 31 October 2020 is the last date permitted for the publication of the interim results under the Financial Conduct Authority’s Disclosure Guidance and Transparency Rules (as modified by the temporary relief granted to all listed companies by the FCA on 27 May 2020), the company does not now expect to submit a request to the FCA to restore the listing of the company’s shares until shortly before publication of the interim results.”

In a trading and operational update for the three-month period ended September 30, 2020, Lookers added: “During the period the group’s dealerships in England, Northern Ireland and Scotland were fully operational following the end of lockdown.

“The group’s trading in Q3 was better than we expected.

“This was underpinned by our significant outperformance of the UK retail new car market, robust like-for-like growth in both used car sales and aftersales revenues.

“It also reflected the strengthening of used car margins and the cost saving and other benefits of our restructuring programme …

“The group has repositioned its fleet business withdrawing from certain uneconomic activities to focus on business which maximises margin retention and working capital efficiency.

“On a like-for-like basis the group invoiced and delivered approximately 12,000 fleet units which was 12.6% below last year …”

In ist outlook, Lookers said: “The temporary closure of the group’s dealerships throughout the lockdown period had a significant impact on financial performance during H1.

“As a consequence, the group expects to report a material underlying PBT loss in H1.

“Trading in Q3 resulted in underlying PBT significantly ahead of last year, largely offsetting the loss recorded in H1.

“Q4 will benefit from the full impact of the group’s restructuring activity, however the board remains mindful of the ongoing uncertainty regarding Covid-19 and the possible impact on the UK car market.”

Lookers CEO Mark Raban said: “Our decisive self-help measures, combined with better than expected trading in Q3 and strong support from our brand partners, have helped the group emerge from lockdown in a strong position.

“Naturally, we remain cautious around the future outlook given the ongoing Covid-19 backdrop but we are well positioned to deal with any emerging challenges.”

About the Author

Mark McSherry
Dalriada Media LLC sites are edited by veteran news journalist Mark McSherry, a former staff editor and reporter with Reuters, Bloomberg and major newspapers including the South China Morning Post, London's Sunday Times and The Scotsman. McSherry's journalism has also appeared in The Washington Post, The Guardian, The Independent, The New York Times, London's Evening Standard and Forbes. McSherry is also a professor of journalism and communication arts in universities and colleges in New York City. Scottish-born McSherry has an MBA from the University of Edinburgh and a Certificate in Global Affairs from New York University.