Inchcape plc, the UK-based multinational car distributor and retailer, has announced preliminary results for the year ended 31 December 2007 which show a further rise in revenue and profit to record levels.
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The bouyant performance was underpinned by further expansion in emerging markets.
The firm said that profit before tax (and before exceptional items) in 2007 was up 9.9% to GBP235m on sales pf GBP6.1bn, which was 25% ahead of the previous year. Earnings per share were up 3.6% to 37p.
Inchcape said it benefitted from both ‘strategic and focused acquisitions, and from encouraging organic growth in sales in most of our markets’.
Inchcape reported continuing progress with acquisitions in Russia and the Baltics, expansion in the Balkans and its entry into China.
In the UK the integration of recent acquisitions contributed to a UK trading profit of GBP69.6m (up 52% year-on-year). International operations achieved sales of GBP3.4bn and trading profit growth of 16%.
International operations represented 76% of group trading profit.
The firm said its distribution businesses delivered record results in Europe, strengthening market leadership in Greece and delivering good growth in Belgium and Finland.
In Australia, the launch of the new Subaru Impreza model helped grow operating margins and delivered a 24.1% growth in trading profits.
The markets in Asia were described as very competitive but Inchcape said it performed well in Hong Kong with trading profits up 17.9% in a market which grew by 16.5%.
In Singapore, the market declined by 9.6% while parallel imports increased their share. In that context Inchcape said there was a trading profit decline of 21.5% ‘but we maintained our market leadership position and strong margin of 9.6%’.
Sales from Inchcape’s retail businesses grew by 53%, benefiting from both acquisitions and organic growth, it said.
In the Emerging Markets, growth was described as outstanding, ‘with like for like sales up 57% and overall sales up 247%’.
André Lacroix, Group Chief Executive of Inchcape plc, said in a statement:
“In 2006 we laid out a clear strategic plan to build on the past successes of the Group. Our twin-track growth strategy is about strengthening our existing business and expanding in Emerging Markets. We have made significant progress in executing our strategy and have delivered record results in 2007 for the sixth consecutive year.
“This has been driven by investment in the high growth Emerging Markets and a robust business model providing the group with a unique diversity of geography, brand, channel to market and value driver. This excellent portfolio diversification gives us the flexibility to react quickly to changing market conditions and maintain our focus on the most productive sources of value relevant to each market.
“The fundamentals of our Group are strong and our strategic direction is clear. Our focus on superior customer service and our track record of operational excellence makes us well placed to deliver continued organic growth this year. Further, the launch of a number of new models in 2008 and the associated investment will enable us to build momentum as the year progresses. Additionally, we expect to benefit from our increased investment in the high growth Emerging Markets.
“We therefore look forward to 2008 with confidence.”
