Pendragon delivers 'strong' Q3 trading performance

Automotive retailer Pendragon said on Tuesday that it had delivered "a strong trading performance" in the three months ended 30 September, with gross profit maintained at "the exceptional level" seen in the third quarter of 2021.

Pendragon, which highlighted that underlying pre-tax profits had slipped from £21.5m to £14.7m during the period, stated its performance had benefitted from "continued progress" in the delivery of its strategy to transform automotive retail through "digital innovation and operational excellence".

The London-listed group stated new vehicle volumes continued to be impacted by reduced supply in the third quarter, with the market down 0.1% against a 2021 baseline which was already well below historic norms.

However, Pendragon said it had outperformed the market with new units up 14.2% in the quarter, while new margins were also said to have remained strong, with gross profit per unit of £2,597 - up £743 compared to 2021.

Used vehicle volumes were also down on the prior year, as reduced new car production continued to have a knock-on impact on used car availability, but aftersales revenue and gross margins were both higher than in the prior year, with revenue up 5.0%, margin rate up to 51.7% and gross profit up 7.8% as a result.

"We are pleased with the performance in Q3 FY22 and remain confident in delivering progress towards our long-term goals. While we continue to expect both new and used vehicle supply shortfalls for the last quarter of FY22 and into 2023, the new car order bank remains well above historic normal levels at over 20,000 at the end of September. The economic backdrop remains challenging, however, we continue to expect to deliver group underlying profit before tax in line with board expectations for the current financial year," said Pendragon.

As of 0840 BST, Pendragon shares were up 2.23% at 27.50p.

Reporting by Iain Gilbert at Sharecast.com