Arnold Clark profit swells
27 September 2021
Arnold Clark saw profit before tax grow 33.7% from £117m to £156.5m in the year ended December 2020, despite revenue falling 15% to £3.8bn. Used car sales fell 20.2% and new car sales declined 26.5% but the business ended the year with significantly more cash resources, boosting net funds available to £524m.
CEO Eddie Hawthorne said more than 12,000 employees were furloughed during the first Covid lockdown, with the company receiving £64.3m in CJRS grants. The final furloughed employees returned in October 2020 and the business did not furlough staff during the second lockdown. £44m of VAT was deferred and £11m claimed in Business Rates Relief.
£2m was spent to make locations Covid-secure, including the purchase of PPE and delivering staff training.
The company also accelerated the rollout of digital services, allowing Click & Deliver and Click & Collect, with 84k vehicles delivered this way and 304k customers using Arnold Clark’s online check-in system. “We have achieved in five months what would historically have taken us five years.”
Nearly 230k customers have downloaded the Arnold Clark smartphone app. This gives owners personalised reminders for MOT, servicing and road tax, allows them to access finance information and payment schedules – and scan vehicle registrations of cars they like to find similar models in stock.
Mr Hawthorne said other board decisions during the year included reducing capital and discretionary expenditure, leaving six smaller branches closed following the first lockdown, and the “difficult but necessary decision to reduce our headcount”.
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