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Interim Results

Inchcape revenues and profits rise

27 July 2017 07:55

Inchcape's first half revenue, profit and free cash flow performance was well ahead of last year as it continue to put its Ignite strategy into action.

Revenues rose to £4.5bn from £3.8bn; ore-exceptional1= operating profit increased to £208.0m from £169.5m and reported profit before tax rose to £191.7m from £165.0.

The group has declared an interim dividend of 7.9p per share - up 12.9%.

Chief executive Stefan Bomhard said: ""Our revenue, profit and free cash flow performance in the first half of 2017 was well ahead of last year as we continue to put our Ignite strategy into action. Reflecting the strength of these results, we now expect to deliver a solid constant currency performance in 2017, modestly ahead of our expectations at the start of the year.

We achieved growth across our diversified set of value drivers, driven by our continued focus on improving our customers' experiences, delivering the full potential of all revenue streams and by leveraging our global scale. I am pleased with the growth in our high-margin Aftersales operations, as we benefit from better expertise sharing within the Group. We have become ever more innovative in our approach to best serve the evolving needs of our customers, especially in digital. I can also report that we continue to identify incremental annual procurement cost savings.

Our unique Distribution model continues to form the core of our business, generating 73% of Group trading profit in H1 and growing 10.7% at constant currency over the period. "Our Emerging Markets Distribution operations performed strongly, including accretion from the strategic South American acquisition made at the end of 2016, which is performing well and in-line with our expectations.

"Furthermore, our Asia region saw a return to profit growth in the first half, not only reflecting the stabilisation of New Vehicle demand in Hong Kong but also our actions to better leverage our scale across the region. "We have a disciplined capital allocation framework and a strongly cash generative business model which enables us to invest in organic and inorganic opportunities to drive growth. "The Distribution additions of PSA in Australia and BMW in Estonia reflect this commitment and demonstrate how we are working closely with leading brands to become the OEM's partner of choice.

"Going forward, we see meaningful opportunities for business development and value-enhancing consolidation in our highly fragmented industry, benefiting our partners, customers and shareholders."

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