Motorpoint has warned that its gross sales are set to fall this 12 months amid ongoing provide chain woes, rising prices and strain on family budgets.
The automobile retailer mentioned customers had been below ‘increasing pressure’ to chop discretionary spending after inflation hit a 40-year excessive within the UK.
Motorpoint mentioned: ‘The impacts of rising inflation and worldwide vehicle supply chain challenges are likely to continue to affect our markets and all industry participants.
Warning: Motorpoint has warned that its sales look set to fall this year amid surging inflation
‘In general, rising inflation is putting increasing pressure on discretionary spending power and consumer sentiment, and this position has worsened since the start of our new financial year. This is very likely to reduce overall sales and transactions in our markets.’
It added: ‘Further, supply chain shortages will continue to limit new car production in the near term, which in turn constrains the supply of used cars that fit our nearly new criteria. The precise extent to which these factors will impact consumer behaviour and our markets is increasingly difficult to predict.’
While warning concerning the outlook for the 12 months forward, Motorpoint additionally revealed a robust set of annual outcomes at the moment.
The group noticed its pre-tax revenue surge 121.6 per cent to £21.5million, whereas gross revenue was 70.1 per cent larger at £106.3million, and working revenue jumped 98.4 per cent to £25million.
Basic earnings per share rose from 8.4p within the 12 months ending 31 March 2021 to 18.7p on the identical time a 12 months later.
Revenues rose by 83.3 per cent to £1.32billlion, amid car value inflation and market share progress.
The group mentioned web site visitors jumped by 15 per cent year-on-year, with ‘improvements across a full range of online marketing metrics’.
On the dividend entrance, the group mentioned: ‘No dividend was paid in the period (FY21: £Nil) and the Board has not recommended a final dividend (FY21: £Nil) while it focuses on driving significant growth.’
Motorpoint shares fell at the moment, and had been down 6.87 per cent or 15.50p to round 210.00p this morning.
Mark Carpenter, chief government of Motorpoint, mentioned: ‘Motorpoint is a unique business with world class capabilities and knowledge in the used car ecosystem.
‘We have always successfully adapted our business to meet every challenge and remain profitable since our inception 24 years ago. I am extremely pleased with the progress we have made on our medium term strategic objectives and am convinced Motorpoint will be a winner in these rapidly evolving markets.
‘We are building a market leader with a disciplined operating culture, and we are confident in the plan we laid out a year ago. Despite the ongoing uncertainty, we will continue to invest in our business with the consumer front of mind, in order to realise our long term ambition of increased market share through price leadership, while remaining profitable.’
He added: ‘We have achieved significant growth and market share gains in the year; our price leadership, strong customer service and focus on maintaining a highly engaged team will continue to substantially grow the business in the years ahead.’
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