A strong first half performance saw Lookers (LON:LOOK) deliver yet another record trading period, overcoming the dilutive effect of the sale of the Parts business in H216. The performance of the continuing activities has been enhanced by the reinvestment of the proceeds in the two new dealership groups last year. In addition the balance sheet remains strong, facilitating both organic investment and M&A, despite the uncertainty that persists in the UK car market. Lookers looks set to continue its growth strategy with a sharper brand focus. The improved prospective yield also has attractions.
First half trading performance is encouraging
The underlying performance in H117 has been encouraging despite a softening of the UK new car market following the record first quarter. Lookers’ new, used and aftermarket sales all showed healthy like-for-like growth and even stronger gross profit improvements. This was further enhanced by the acquisitions of Knights and Drayton during H217, which have offset the dilution of the disposal of the highly profitable Parts distribution business last year.
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