Altrincham-based car dealership Lookers plc reported that its 2021 revenue rose 9% to £4.05 billion and underlying profit before tax soared to £90.1 million from £13.7 million “primarily driven by used vehicle margins.”
Lookers reinstated its dividend with a proposed full year payout of 2.5p per share which the group “intends to grow progressively.”
The company said the momentum of last year has continued into trading in the first quarter of 2022.
Robust consumer demand and supply constraints on both new and used vehicles have seen gross margins being maintained at 2021 levels.
This, combined with a tight control on costs, sees Lookers ahead of 2021 on an underlying profit basis.
However, Lookers warned: “The ongoing semiconductor shortage is likely to see new car supplies constrained for the remainder of 2022.
“Headwinds caused by high levels of inflation in areas such as utilities, mean the group will experience material cost increases.
“Wider inflationary pressures and the macro-economic impacts of the crisis in the Ukraine add significant uncertainty to the trading conditions faced by the group.
“Notwithstanding these uncertainties, the board remains confident about the outlook, and that the group is well placed for the remainder of 2022.”
Lookers CEO Mark Raban said:“2021 was a record year for Lookers.
“We navigated another year of limited new vehicle supply and COVID-19 disruption.
“We have reported excellent profits and cash generation, through strong used car margins, continued focus on costs and the unstinting efforts of our people.
“We have successfully moved back to a net funds position in the business and have a strong balance sheet, underpinned by our property assets, supporting our investment capacity to grow the business.
“The business and our customers face some uncertainties in 2022.
“Trading in Q1 has been strong despite new vehicle supply remaining tight.
“The current crisis in Ukraine and significant cost of living increases will put pressure on consumer sentiment and disposable incomes.
“However, the Group is looking forward to the future with confidence.
“It has emerged from the challenges of the past couple of years stronger and with a clear strategy to navigate future challenges and drive value for all our stakeholders”.