Inchcape turned in a solid set of results in the UK in 2014 with trading profit up 3% to £65.2m on turnover up 11.2% to £2.47bn.
Trading margin in its retail business fell 20bps in 2014 dented by higher volumes in new vehicle sales and price pressures in the new and used car markets.
The group’s UK fleet business performed strongly, with a record trading profit up 20.9% to £10.4m.
Inchcape saw strong growth in aftersales as it benefited from its investment in call centres and digital offer, including online service booking.
Looking to the future it said: “We expect the solid fundamentals of the UK economy, coupled with factors unique to the automotive market, such as PCP financing, to support further industry growth in 2015. Post-2007, automotive sales in the UK declined significantly, remaining below 2007 levels for six years and creating significant demand for new cars in the market.
“Furthermore, our aftersales operations will continue to benefit from the growth in the 1-5 year Car Parc.
Worldwide the group saw turnover up 10% to £6.7bn with pre-exceptional profits up 18.8% to £303.2m at constant currency.
Inchcape group CEO Andre Lacroix said: “The group has a track record of delivering sustainable earnings growth with a high return on capital employed and we believe our distinctive strength across primarily small and medium size markets in both vehicle sales and aftersales will continue to drive consistent returns for our shareholders.
“We have good visibility across our markets and categories and, notwithstanding an uncertain geopolitical environment in some of our markets, we expect to deliver a robust underlying constant currency performance in 2015.”
As previously announced Lacroix is leaving the company and a new CEO Stefan Bomhard takes over on 1 April.
Analyst with Zeus Capital mike Allen said: “The UK performed below our expectations, but did grow slightly ahead of the market, albeit margins did slip 20bps to 2.6%, and this is a theme we have seen across other UK operators given the volumes coming into the market at present.”
