Fleet News

Pendragon hints at contract hire sale

DEALER group Pendragon is to sell a number of its businesses to reduce its gearing following the acquisition of Evans Halshaw, raising questions about the long-term future of its contract hire operation. Announcing the company's financial results for the year to December 31, 1998, Pendragon chief executive Trevor Finn said the group would institute a 'programme of selected disposals'.

He is reportedly looking to raise £30 million by selling businesses. Neither Pendragon Contracts, which has a fleet of 11,400 vehicles, nor c.2K (acquired as part of Evans Halshaw) which has a fleet of 6,500 vehicles, are considered core to Pendragon's future strategy which is focused on car retailing via large franchise territories.

A spokesman for the plc said: 'There is a possibility that if the right situation arises then contract hire may be considered non-core and disposed of.' Pendragon Contracts saw its pre-tax profits slip by half a million pounds to £5.1 million (1997: £5.6m) due to lower residual values for end-of-contract vehicles. Overall, Pendragon reported a 23.8% rise in pre-tax profits to £18.7 million (1997: £15.1m) on turnover up 47.3% to £1,272 million (£863.7m).

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