30 June 2021

Lookers has missed an end of month deadline to announce its 2020 annual results but has escaped possible suspension from the London Stock Exchange under FCA rules because it published the figures before the opening of the markets today (1 July). The group should have submitted results yesterday (June 30) but eventually published its 2020 annual results at 7am today.

The FCA told Auto Retail Agenda it could not comment on Lookers case but added that firms can apply for a delay in suspension under current Covid leniency rules.

Lookers CEO Mark Raban

Lookers shares were suspended from trading this time last year after failing to issue annual results for 2019 by the 30 June deadline. Lookers shares began trading again at the end of January after the firm finally published its 2019 annual results.

The PLC retail group issued a statement on Monday (28 June 2021) warning that its results, due Tuesday, would be delayed but added it was hopeful they would be issued by the deadline of Wednesday evening. Auto Retail Agenda understands the issue was linked to the recent change in auditors from Deloitte and BDO and is unlikely to have had any material effect on the figures.

The 2020 Lookers results, released this morning, show a return to profit for the group with an underlying profit before tax figure of £14.1m on a £3.7bn turnover. The statutory profit stood at £2.0m. In 2019 the group lost £45.7m.

The non-underlying figures include the release of a £10.4m provision made in 2019 for the FCA investigation, £12.5m in restructuring costs, £9.2m in professional fees, a goodwill and intangible impairments of £3.6m (mostly against Lookers’ Ford “cash generating unit”) plus a £3.1m credit on property disposal.

Commenting on the results, CEO Mark Raban said: “2020 was a challenging year for the Group dealing with both the impact of COVID-19 and the Group’s legacy issues.

“We are emerging from this period operationally, financially and culturally as a better business, focused on putting the customer at the centre of everything we do.

“We expect to build on the strong momentum within the business, underpinned by our excellent manufacturer relationships, omni-channel technology platform and fantastic Lookers colleagues. We are now in a great position to benefit from the many growth opportunities available for the business.”

Meanwhile, Lookers is also once again looking for a chief financial officer after interim CFO Anna Beilby didn’t stand for re-election at yesterday’s AGM. Ms Beilby, who would have been responsible for compiling the 2020 year-end results, will remain with Lookers until the end of July 2021.

Read our full interview with Mark Raban in the July issue of Auto Retail Bulletin.

Highlights

• Revenue of £3.7bn (2019: £4.8bn) impacted by lockdown and trading restrictions throughout the year.
• Underlying profit before tax of £14.1m (2019: £4.0m) with strong performance in the second half of the year, more than offsetting a challenging first half. Statutory profit before tax of £2.0m (2019: Loss before tax £45.7m).
• Outperformance against the UK retail new car market of 9.6 percentage points with resilient trading in used cars and aftersales.
• Significant restructuring activity completed, reducing headcount, strengthening the Group’s operating model and materially reducing the cost base. On track to deliver annualised savings of approximately £50m.
• Strong balance sheet with a valuable property portfolio of c.£300m (77p per share).
• Reduction in net debt benefitting from management actions. Net debt has reduced further in 2021, with a net cash position currently of approximately £18m.
• Revolving Credit Facility extension agreed with existing banking club for an initial £150m.
• FCA investigation into the Group’s historic sales processes closed without sanctions, resulting in the release of the prior year £10.4m provision.

Tags: Lookers, Mark Raban