Gateshead-based Vertu Motors plc said it expects full year adjusted profit before tax to be broadly in-line with current market consensus, although profit for the first half of the year will be lower than prior year levels. 

The company said performance in the second half of the financial year is expected to improve with a stronger used car market and higher used vehicle trade values.   

It is scheduled to announce interim results for the six-month period ended 31 August on 16 October. 

“Manufacturers of new vehicles selling in the UK are actively managing volumes and mix of Internal Combustion Engine (ICE) and Battery Electric vehicles (BEV) to meet legislative targets around BEV mix,” Vertu said. “Retail demand for new vehicles, particularly of BEV, is likely to remain weak, driven in part by high vehicle prices and the lack of Government financial incentives. The Group’s new vehicle order-take for the important plate change month of September is currently tracking at levels below prior year reflective of the weakening retail market in 2024.”

“Reduced supply of used vehicles should mean that used car pricing will remain stable. Reduced interest rates should aid the future affordability of used cars and reduce Group interest costs. The Group has increased used inventory levels from the levels at 29 February 2024 to ensure sufficient stock is available for September, given the supply dynamics in used vehicles, and likely weakness in the September new retail market.  Nonetheless used vehicle stock levels remain reduced on a year ago.”

Robert Forrester, Chief Executive of Vertu Motors, said: ”I am pleased with the Group’s performance against a fast-shifting market backdrop. Our high margin, resilient aftersales business continues to thrive aided by higher technician numbers and strong execution of the Group’s vehicle health check process.”

“The retail new car market remains weaker as the Government’s regulation to transition to battery electric vehicles causes market volatility and negative impacts.  The current dislocation in the market presents opportunities for Vertu Motors to capitalise on, assessed using strict investment return metrics, with our strong balance sheet providing financial flexibility, an excellent portfolio of strong brands, robust and scalable systems, and a strong and experienced leadership team with motivated colleagues.”