Auto Retail Agenda: 30 November 2020
29 November 2020
- PENDRAGON’S BUSY WEEK
- HAWCO VOLKSWAGEN IN COVID LOSS
- POWELLS TO CLOSE AFTER 67 YEARS
- NFDA WARNS OF TRADE PLATE DELAY
- FORD RECRUITS EBAY MARKETING BOSS
- JOE MALLON IS RENAULT IRELAND DEALER OF THE YEAR
- STOCKWATCH – Caffyns up on positive H1 2020 results with pre-tax profit rising to £1.5m
- COMING UP – Lockdown lifts
- MOTORPOINT IN H1 PROFIT, ATTRACTS NEW INVESTOR
- COVID TIERS MAY END BY FEB
Pendragon’s busy week
Amsterdam’s Farringdon Capital Management, co-founded and owned by Bram Cornelisse, has taken a 3.36% stake in Pendragon. The deal sees Farringdon become Pendragon’s sixth-largest institutional stakeholder.
Also last week, Teleios further reduced its stake in Pendragon from 16.17% to 14.41%, compared to a high of more than 21% in February 2019. Odey is the second largest investor with a 16.16% share, ahead of Anders Hedin on 13.54%.
In other news, the Competitions and Markets Authority last week announced it had served an initial enforcement order on 18 September to two motor industry retailers about an anticipated acquisition by one party for the other. The details were redacted so the two retailers cannot be identified.
On 12 November, the two parties confirmed to the CMA they had abandoned the acquisition, before they made any public announcement regarding the transaction.
In early May, Pendragon confirmed it had been investigating a merger with Lookers, which subsequently rejected the approach due to the ongoing FCA investigation. Last week, Lookers finally announced its 2019 results, which revealed a £45.5m loss to the year ended 31 December.
Hawco Volkswagen in Covid loss
Scottish Highlands retailer Hawco Volkswagen has lost £726k in the first half of 2020 due to coronavirus. However, strong trading since reopening means the group expects a return to breakeven by the end of Q3. The figures were revealed in the company’s full-year 2019 accounts to the end of December, which showed turnover decreased from £75m to £73.8m – and profit before tax fell from £427k to £67k.
Powells to close after 67 years
Redruth retailer Powells Garage is to close on 15 December after 67 years in business. Reg and Raymond Powell established the business in 1953; today, Heather and Kenneth Powell run the retailer, which was the first in Cornwall to become Trading Standards ‘Buy with Confidence’ approved. However, their sons have decided not to continue with the family business, which has been acquired by the South West Ambulance Trust.
NFDA warns of trade plate delay
The NFDA is advising retailers carefully check trade plate application forms and payments to ensure they do not experience any delays from the under-pressure organisation. December is a peak month for trade plate renewals and a large number are currently being rejected due to incorrect payment amounts, errors on cheques and not ticking the box declaring whether you are trade, dealer or a repairer.
The DVLA has produced a step-by-step guide to avoid trade plate application rejections: https://bit.ly/39CGjKj
WORLD NEWS
Ford recruits eBay marketing boss
Former eBay CMO Suzy Deering has been appointed global CMO at Ford. Observers say recruiting from outside the automotive industry suggests Ford is seeking to overhaul its marketing division with a greater focus on the tech industry.
“We’re putting more decision-making in the hands of our people who are closest to customers,” said Ford Americas president Kumar Galhotra. “That makes marketing more important than ever.” Ms Deering starts on 4 January 2021.
Joe Mallon is Renault Ireland Dealer of the Year
Joe Mallon Motors has been named Ireland’s Renault Dealer of the Year 2020, ahead of 28 other Irish Renault retailers. The retailer also scooped the CRM Dealer of the Year award. Director of the family-run business Philip Mallon will join other European Dealers of the Year at an event in Paris when coronavirus restrictions allow.
STOCKWATCH
Closing prices on 27 November 2020 and weekly change
Caffyns up on positive H1 2020 results with pre-tax profit rising to £1.5m
Auto Trader Group 548.2p (-6.4p / -1.1%)
Cambria 55.5p (-1.0p / -1.7%)
Caffyns.0p (+55.0p / +17.0%)
Halfords 268.5p (+9.0p / +3.4%)
Inchcape 598.0p (-25.0p / -4.0%)
Lookers Shares suspended at 21.0p
Marshall Motor Holdings 139.0p (+2.5p / +1.8%)
Motorpoint 308.0p (+14.0p / +4.6%)
Pendragon 13.52p (+0.16p / +1.1%)
Vertu 31.15p (-1.85p / -5.7%)
COMING UP
Wednesday, Lockdown ends; tier system reintroduced
Wednesday, BRC shop price index
Friday, Aston Martin Lagonda general meeting
10 December, Auto Retail Live: Outlook for 2021. Sign-up here.
MONEY MATTERS
Motorpoint In H1 profit, attracts new investor
US investor Hunter Capital has taken a 3.96% stake in Motorpoint. New York’s Long Light Capital has also reduced its stake from 4.95% to 3.56%. Immersion Capital remains by far Motorpoint’s largest institutional stakeholder with a 19.68% holding.
In a positive H1 2020 trading update, the company reported a 3% improvement in profit before tax to £9.7m, despite revenue falling 27%. Online accounted for more than 40% of sales in H1, with home deliveries representing 1 in 5 online sales in September. Online customers also now have a 14-day money-back guarantee. Motorpoint’s directors took reduced renumeration during the period to maintain lower-paid employees at 100% of earning during the lockdown closure.
Covid Tiers may end by Feb
PM Boris Johnson has told Conservative MPs there will be a ‘sunset’ expiry of 3 February for the new Covid tier rules that, if a vote in the House of Commons passes on Tuesday, will come into force on Wednesday 2 December. He also suggested rules could be eased in December and MPs may vote again on the tier system in January.
99% of the UK is in either tier 2 or 3, although retailers are allowed to open across all three tiers. “It is worth remembering that the world of this Wednesday is not a lockdown, even in tier 3,” wrote Mr Johnson in the. Mail on Sunday. The newspaper also reported economic experts project the new system will cost the economy £900m a day.
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