UPDATE 1-Lookers says starts year on strong footing

(Adds details, chairman statement)

LONDON, May 13 (Reuters) - Car dealer Lookers Plc (LOOK.L: Quote, Profile, Research) said its financial year started more strongly than a year ago, but that it remained cautious about growth in new car sales.

Tough trading conditions are being offset by the group's now-profitable used-car and aftermarket parts divisions, which in 2007 represented 54 percent of gross profit, Lookers Chairman Phil White said in a statement.

The acquisition earlier in May of Bramall and Jones VW, two Volkswagen (VOWG.DE: Quote, Profile, Research) businesses and a contract hire and leasing business, has increased its portfolio and given it an entry into the contract hire market, Lookers added.

"These, together with the continuing investment in our independent aftermarket parts division and the turnaround in the car supermarkets, will contribute positively to the outcome in the current year," White said.

"We are clearly mindful of the current uncertainties within the UK economy but provided there is no further significant deterioration in the economy, we are still confident of delivering another year of growth in 2008 in line with market expectations."

Lookers, whose shares are down 55 percent in one year, are worth 170 million pounds. (Reporting by Hsu Chuang Khoo; Editing by Louise Ireland)