Motorpoint losses hit -£8.2m in “most difficult year” ever

Motorpoint saw losses widen to -£8.2m in the year to March 2024 compared to losses of -£300,000 the prior period on turnover down 24.6% to £1.09bn.

It said the market was the worst it had traded in with high interest rates, inflation, consumer uncertainty and higher finance stocking costs.

Motorpoint was particularly hit by the smaller used car parc due to successive years of reduced new car sales.

Its core market of 1-4-year-old cars shrunk to 1.5m from a pre Covid high of 2.5m and the number of vehicles it sold fell to 52,500 in the fiscal year compared to 57,300 last time.

To counter this the group started stocking older five-year-old cars with up to 50,000 miles on the clock, cut its employee count by 25% from 950 to 710 and halted its expansion programme.

It said it returned to profitability in Q4 and now expects to start its store expansion programme this year.

Mark Carpenter, CEO of Motorpoint Group, said: “The past financial year was the most difficult in our history, with multiple negative headwinds in the macro environment such as rising borrowing costs and subdued customer demand, coupled with industry specific issues such as lower inventory and deflation.

“The resilience of our cash generation evidences the strength of our business model, and we now look forward to continuing our journey of profitable growth as the improving trends of Q4 have continued into Q1.

“Our lean cost base, strong data driven focus on margins, faster stock turn and enhanced digital capabilities should enable us to continue the Q4 FY24 trend of profitable growth.