Annual profits

Record annual profits for Lookers

The Lookers Mercedes-Benz dealership in Wolverhampton

The group, which has sites in the Black Country, Shropshire and Staffordshire, saw its underlying pre-tax profit rise from £13.7m in 2020 to £90.1m, mainly thanks to margins on used vehicles.

Revenue also increased by 9%, from £3.69 billion to £4.05 billion.

Managing Director Mark Raban said: “2021 has been a banner year for Lookers. We have gone through another year of limited new vehicle supply and Covid-19 related disruptions. We have delivered excellent profits and a generation of cash, thanks to strong margins on used cars, a continued focus on costs and We have successfully returned to a clean financial position in the business and have a strong balance sheet, backed by our real estate assets, supporting our investment capacity to develop the company.

“The business and our customers face some uncertainties in 2022. Trading in the first quarter was strong despite the supply of new vehicles remaining tight. The ongoing crisis in Ukraine and significant increases in the cost of living will exert a pressure on consumer confidence and disposable incomes. However, the group looks to the future with confidence. It has emerged from the challenges of the past two years stronger and with a clear strategy to meet future challenges and create value for all our stakeholders.

Pre-tax statutory profit also improved from £1.5m to £90m and a dividend was reinstated with a proposed annual dividend of 2.5p per share, which the group intends to gradually increase.

Lookers warned that the current shortage of semiconductors will likely lead to a limited supply of new cars for the rest of 2022. Headwinds caused by high levels of inflation in areas such as utilities also mean that the group will experience significant cost increases.