March 13, 2019 / 7:37 AM / 7 months ago

Britain's Lookers profit falls on weak new car sales, higher costs

(Reuters) - British car dealership chain Lookers Plc on Wednesday reported a 1.6 percent fall in full-year adjusted pretax profit, hit by slowing sales of new cars and higher costs.

The chain, which sells vehicles for 32 manufacturers including all major brands such as Volkswagen, Ford and BMW, said political uncertainty around Britain’s impending exit from the European Union had weighed on demand for new cars.

To counter the weakness, Lookers has been focusing on selling used cars, a market that has remained buoyant.

The company, which is among the top three motor vehicle retailers in the UK, said it booked some costs related to closures and reorganisation following changes to its dealership portfolio.

It also flagged higher payroll costs, citing a rise in inflation and workplace pensions, as well as higher property and IT costs.

Lookers said its order book for the delivery of new cars in March was in line with its expectations, but volumes were expected to fall.

The company, which sells over 220,000 new and used cars, said new car turnover fell 3.3 percent, while used cars turnover rose by 14 percent and aftermarket sales were up 6 percent.

The company said adjusted pretax profit fell to 67.3 million pounds for the year ended Dec. 31 from 68.4 million pounds a year earlier. Turnover rose 3.9 percent to 4.88 billion pounds.

Reporting by Samantha Machado in Bengaluru; Editing by Anil D'Silva

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