Lookers expects profits to fall as two senior officers quit
British car dealership predicts that its profits will plunge by more than two-thirds
UK car dealership Lookers is the latest victim of weak consumer confidence and political uncertainty, with the company experiencing a “much more challenging than expected" period over recent weeks since mid-September.
The company said that the resulting pressure on used-car margins and retail cost inflation will mean a fall of more than two-thirds in its annual underlying profit to £20m ($25.91m, €23.2m).
Trading in new vehicles during the third quarter was below the board’s expectations with a -3.2 per cent decline in like-for-like unit sales of new cars.
Meanwhile, the used-car market remained relatively stable during the period with like-for-like unit sales of used cars increasing by +2.6 per cent.
Lookers also announced that its chief executive officer Andy Bruce and chief operating officer Nigel McMinn will be stepping down from the board with immediate effect.
Until permanent successors have been appointed, chairman Phil White will be executive chairman and Richard Walker, currently a non-executive director, will assume a part-time executive role.
UK car production has fallen by 3.8 per cent in September due to ongoing political uncertainty. Overall car output for the year to date plunged 15.6 per cent, making it the weakest three quarters since 2011.
Additionally, PSA Group, the French owner of Peugeot, is set to merge with Fiat Chrysler to create the world’s fourth- largest car manufacturer, with a combined worth of around $50bn (£38.6bn, €44.8bn).
This could result in a restructuring of their British-based operations.