Lookers results reveal fraud, inflated profits, £45m loss

Troubled Altrincham-based car dealership Lookers plc — whose shares have been suspended amid an accounting investigation — on Wednesday reported a loss before tax of £45.5 million as it finally published much-delayed results for the year ended December 31, 2019.

Lookers reported a total of £25.5 million of non-cash adjustments which are necessary to correct misstatements in profit before tax “over a number of years.”

It reported a provision of £10.4 million “for potential liabilities arising from the ongoing Financial Conduct Authority (FCA) investigation.”

Lookers said investigations identified “a cash expenses fraud which led to a loss of £327k in a single division and which accumulated over several years.”

Total revenue for the year was £4.787 billion, up from £4.828 billion in 2018.

Lookers said it will publish its interim results for 2020 “as soon as possible in December” and expects to “submit a request to the FCA seeking to restore the listing of the company’s shares after the publication of its interim results.”

Lookers executive chairman Phil White said:  “The last twelve months has been extremely challenging for Lookers with the ongoing impact of COVID-19 and the accounting issues.

“Significant restructuring activity has been necessary to ensure we lay the right foundations for the future.

“On behalf of the board I would like to thank all of our employees for their efforts and our wider stakeholders for their patience and ongoing support. 

“Despite our recent challenges, we are extremely proud of how our people have responded, showing real dedication and flexibility particularly through maintaining critical vehicle servicing for key workers who have needed to remain on the road.

“The investigation into our financial systems and accounting controls, the delay in the publication of our 2019 results and the subsequent temporary suspension of our shares have been a great disappointment.

“As chairman of Lookers, I would like to apologise unreservedly to all our stakeholders for the uncertainty this has caused.”

“We emerged from the initial lockdown in a strong position and are well equipped to deal with the second lockdown in England. We have an industry leading portfolio, underpinned by a talented and dedicated team which means that we can look to the future with confidence.”

“My focus now is to restore the listing of our shares and to strengthen the Board to take advantage of the many opportunities that lie ahead for Lookers, which is fundamentally a great business.”

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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.