Lookers, a leading UK motor retail and aftersale group, has lifted profit expectations for the year on the back of promising Q3 results.
While new car sales flagged amid a global semiconductor chip shortage Lookers has outperformed the market by around 3.4 percentage points.
Despite the dip the company has said it is expecting profit before tax for 2021 to be “materially ahead” of previous estimates with the stock brokers Peel Hunt and Numis raising predictions to around £82m.
Mark Raban, Chief Executive Officer of Lookers, said the company had “built on its record first half result” and “performed strongly in a challenging market.”
“Although supply restrictions remain, we continue to work with our OEM partners to minimise the impact and I would like to thank my colleagues and customers for their patience and understanding,” said Raban.
The news comes as the car market is buffeted by supply chain issues which are hampering the output of new cars and engines.
Lookers has seen new car sales contract by 28 per cent, used car sales drop by 17 per cent while revenues dropped by 3.5 per cent. Nonetheless, the company has deftly managed cash flows and turned around a net debt position of £25.9m in Q3 last year to a net cash position of £30m.
London-listed stock broker Peel Hunt has upped its profit expectations for Lookers by 29 per cent to stand at £82.6m for the full year with earnings per share projected at 16.3 pence. Numis also raised profit expectations by 26 per cent to £82m from £65m.
Lookers’ share price has climbed 5.93 per cent above yesterday’s close price to stand at 64.30 GBX.