(Alliance News) - Lookers PLC on Wednesday said it now expects full-year underlying pretax profit to be "materially ahead" of its previous forecasts given a strong third quarter showing.
The guidance bump comes despite the global shortage of semi-conductors which has continued to place increasing pressure throughout the third quarter on the supply and availability of new vehicles, Lookers said, leading to robust used vehicle demand as a result.
Shares in the Altrincham, Cheshire-based car dealer were up 5.8% to 64.20 pence each in London.
"Trading in the third quarter remained strong and above the board's expectations driven by new vehicle market outperformance, excellent new and used vehicle margins and continued tight cost and working capital control," the motor retail and aftersales service company said.
While like-for-like used vehicle sales were down 17% in the quarter against strong year-ago comparatives, this was more than offset by "unprecedented margin retention". Aftersales revenue in the quarter remained "robust", and on a like-for-like basis was 3.5% below last year.
Looking ahead, Lookers pointed to a strong new car order bank, above normalised levels. However, there remained "material and increasing uncertainty" as to the availability of these vehicles due to supply problems.
"The group has built on its record first half result and performed strongly in a challenging market, underpinned by further enhancements to its omni-channel experience," said Chief Executive Mark Raban.
By Will Paige; willpaige@alliancenews.com
Copyright 2021 Alliance News Limited. All Rights Reserved.