Pendragon back in profit

Pendragon, the UK's largest car dealer, bounced back into profit in 2009 but is cautious going forward ahead of the end of the car scrappage scheme and expects conditions to remain difficult.Profits in 2009 came in at £1.3m compared with a loss of £194m. On an underlying basis, profits were £10.1m against a loss of £33.8m. Revenues dropped sharply from £4.2bn from £3.2bn as Pendragon cut out a lot of low margin fleet work.Underlying operating profits were £53.4m compared to £25.8m in 2008 and each of operating divisions was profitable. The improvement in these trading profits was primarily driven by margins in used car sales, which recovered strongly during the year, and the benefit of the cost saving, Pendragon said."We expect the used car market to remain stable and aftersales to be resilient. In 2010 we therefore expect our used car margins to remain solid and aftersales to benefit from growth opportunities. We concur with the SMMT view that the new car market will remain subdued for the next 12 months. We believe a gradual improvement will then be seen. We have taken actions which give us confidence that we will improve the performance of the Group in 2010 despite the anticipated difficult markets," chief executive Trevor Finn said. There is no dividend.