Lookers shares up 90% as they resume trading

Shares of troubled Altrincham-based car dealership Lookers plc soared almost 90% on Friday after the stock resumed trading on the London Stock Exchange.

Lookers shares soared to around 40p, having last closed at around 21p in July last year after the shares were suspended amid an accounting investigation.

Lookers also announced the appointment of company veteran Duncan McPhee as chief operating officer, results for the six months ended June 30, 2020, and a trading update for the full year ended December 31, 2020.

Revenue for the six months fell to £1.56 billion from £2.60 billion in H1 2019 “reflecting the impact of COVID-19 and the closure of a large part of the group’s business for a significant period.”

The group recorded an underlying loss before tax of £36.1 million and statutory loss before tax of £50 million.

“The group is in continued discussion with the FCA around the events that led to the delay in publishing the 2019 Annual Report and Accounts and the suspension of the company’s shares from trading on 1 July 2020,” said Lookers.

“.. the board has applied to the FCA for the restoration of the company’s shares to the premium listing segment of the official list of the FCA and to trading on the London Stock Exchange.”

In its full year trading update, Lookers said: “Trading in the second half of 2020 was encouraging, underpinned by significant outperformance of the retail UK new car market, continued resilient trading in used and aftersales and increasing used car margins.

“The second half performance also includes the early impact of the group’s restructuring programme.

“Despite the impact of the second national lockdown in November, performance in the second half of the year is expected to be ahead of last year, largely offsetting H1 underlying loss before tax of £36.1m.”

Lookers CEO Mark Raban said: “2020 was a challenging year for Lookers, managing the impact of the COVID-19 pandemic and a number of legacy issues facing the group, which required significant action to restructure and improve the business for the long term.

“Despite a resilient sales performance, the benefit of Government support and prompt action taken to manage costs, in the first half we incurred a significant loss in a very difficult period for the car retail industry.

“Although various restrictions continued into the second half of the year, trading improved significantly, benefiting from the material cost saving measures implemented earlier in the year and enhancements we have made to our retail offer, including the capability to carry out contactless vehicle sales.

“I would like to thank all my colleagues for their continued dedication in these difficult circumstances and also our OEM brand partners for their ongoing support.

“Going into 2021 there remains a high level of uncertainty in the wider environment, but we are confident that the group is now much better positioned for the longer term and can capitalise on the various opportunities ahead, not least in electrification and digital developments.”