29 January 2021

Lookers has finally issued its 2020 first half results allowing it to apply to restore share trading on the London Stock Exchange after a six-month gap. The troubled dealer group, which revealed an underlying loss before tax figure of £36.1 million in H1 2020, has also appointed a new chief operating officer Duncan McPhee.

Lookers CEO Mark Raban

Figures for the first half of 2020 show revenue was down 40% to £1.56 billion on 2019’s £2.61bn. The underlying profit before tax for H1 2019 was £22.0m. However, the first half loss was largely off-set by second half trading, according to the group.

Commenting on the group’s performance for the whole of 2020 Mark Raban, Lookers CEO, said: “2020 was a challenging year for Lookers, managing the impact of the COVID-19 pandemic and a number of legacy issues facing the Group, which required significant action to restructure and improve the business for the long term. Despite a resilient sales performance, the benefit of Government support and prompt action taken to manage costs, in the first half we incurred a significant loss in a very difficult period for the car retail industry.

“Although various restrictions continued into the second half of the year, trading improved significantly, benefiting from the material cost saving measures implemented earlier in the year and enhancements we have made to our retail offer, including the capability to carry out contactless vehicle sales.”

In the company’s statement to the LSE, Lookers reported: “In light of the evolving COVID-19 situation and latest lockdown restrictions impacting much of the Group’s portfolio, the Board remains cautious about the outlook for 2021. However, the Board continues to believe the Group is well positioned to benefit from its continued progress and the exciting sector developments including electrification and further digitisation.”

The issuing of these results brings Lookers back withing the regulations of the LSE and as such the group has applied to the FCA so that its shares can be traded again. Lookers was originally suspended at the start of July 2020.

New COO Duncan McPhee has more than 25 years of experience in the motor retail industry including spending the last 12 years at Lookers in a number of senior management roles. Most recently, he has been chief retail operations officer with responsibility for the dealership portfolio and OEM relationships. Before joining Lookers, he spent 10 years with Arnold Clark in Scotland, including five years as general manager.

Interim results highlights

• Revenue of £1,563.7m (H1 2019: £2,605.1m) reflecting the impact of COVID-19 and the closure of a large part of the Group’s business for a significant period.
• Modest outperformance of the UK new car market, with resilient trading in both used car sales and aftersales.
• Commenced a planned restructuring to strengthen the Group’s operating model. This included a further 12 site closures before the end of 2020 (15 closed in 2019) and a total of c.1,500 redundancies. The full benefit of these changes will be seen in FY 2021.
• Strong cost control mitigated some of the reduction in revenue, however, the Group recorded an underlying loss before tax of £36.1m (H1 2019: profit of £22.0m) and statutory loss before tax of £50.0m (H1 2019: profit of £19.6m).
• Net debt of £11.0m at 30 June 2020 (31 December 2019: £59.5m) driven by strong working capital and cost control, alongside the benefit of deferred VAT and delayed PAYE/National Insurance payments agreed under Government schemes.

Tags: Lookers, Mark Raban