Motor Trader The award-winning and longest running UK magazine for car retailing professionals. Your first stop for News, Jobs and Reports for the motor industry.
The main themes from Inchcape‘s interim results continued throughout its third quarter, including progress on the integration of Derco, improving car supply, and strong margins.
Group revenue of £2.8bn in Q3 2023 represented a 35% increase from Q3 2022, aided by acquisitions but also strong organic growth of 10%.
Distribution revenue (+47% reported) benefited from the inclusion of Derco. The integration of this major acquisition remains on track, with the group now guiding accelerated cost synergies in FY23 (c. £20m in FY23 of the full £40m vs. c. £12m previously) and having reduced 50% of Derco’s c. £200m excess inventory (up from 20% at the interim results).
Retail revenue increased by 2% (organic: +1%), supported by volume growth and a strong fleet market, but offset by the transition to the agency sales model, which lowers revenue without a material impact on absolute profits.
Without the impact of the agency sales model in the UK, retail organic growth in Q3 was 12%.
Duncan Tait, Group CEO, commented: “Inchcape produced another strong performance in the third quarter. We delivered continued momentum across APAC, supported by acquisitions.
“Driven by the highly cash generative and capital-light characteristics of our business, Inchcape will continue to be a key consolidator in a highly fragmented market. As a result of our market leadership positions, diversified business and digital and data capabilities to support our OEM partners, we remain confident about the medium to long term outlook for the group.”