Pendragon grows profit and physical footprint in Q1

Motor dealer franchise group Pendragon reported an 8.7% rise in underlying profit before tax in its first quarter on Thursday, with like-for-like gross profit increasing across all main vehicle sectors of aftersales, used and new.

The FTSE 250 group put the increase down to a combination of market dynamics, customer initiatives and a “clear strategy”.

Aftersales gross profit increased by 1.2% on a like-for-like basis, used gross profit increased by 4.2% like-for-like, and new gross profit was up 15.2% on a like-for-like basis.

The group’s online presence was growing as well, with visits to Stratstone.com and Evanshalshaw.com growing by 18.5% in the period.

During the quarter, Pendragon opened three stores in Bristol, Norwich and Peterborough - all new territories for the group.

It promised to acquire further sites this year to supplement its national footprint.

The company’s board said its target debt to underlying EBITDA ratio continued to be significantly below the target range, and it is assessing the best use of funds.

"Our first quarter underlying profit before tax increase is testament to our continued delivery of our strategy,” said Pendragon chief executive Trevor Finn.

“We remain focused on initiatives which provide choice, value, service and convenience to our customers.”

Finn said many of the company’s initiatives are oriented around online consumer activity, from research of vehicles to the nationwide availability of a vehicle.

“We are expecting to see growth in profitability across aftersales, used and new for the full year as we continue to benefit from favourable market conditions and further implement our winning retail initiatives.

“We are expecting the group to perform in line with expectations for the full year,” Finn confirmed.