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(Sharecast News) - Auto Trader cancelled its interim dividend because of the second Covid-19 lockdown as the car sales platform reported a near halving of first-half profit.
Operating profit fell 48% to £68.5m in the six months to the end of September as revenue dropped 37% to £118.2m.
Auto Trader said the government's decision to close car dealers for at least four weeks as part of the Covid-19 lockdown in England had increased uncertainty for customers and made it more cautious about trading beyond November.
The FTSE 100 company said it would make advertising packages free for UK retailer customers in December and extend payment terms by a month for November services.
"It is our intention to return to our long term capital allocation policy as early as possible, but following the recent government announcement, we will not be declaring an interim dividend," Auto Trader said.
The company said demand for used cars had been strong since early June and that consumer activity seen in October and early November would sustain some sales.
Auto Trader's first half began in April just after the start of the UK's first coronavirus lockdown. The company said revenue was hit by its decision to let retailer customers advertise for free in April and May with a 25% discount in June.
Nathan Coe, Auto Trader's chief executive, said: "The past eight months have represented perhaps the greatest challenge ever faced by our company and our industry. The recent government announcement once again restricts our customers' ability to meaningfully trade. As we have announced today, we remain committed to supporting our retailer partners."
Auto Trader shares fell 0.5% to 591.40p at 08:23 GMT.
1 Jun 2023 16:57
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