Fleet News

Perry Group's profits under pressure

A MOVE away from low margin fleet sales, residual value pressures and a shortage of skilled staff have contributed to a slump in pre-tax profits for motor retailer and accident repairer Perry Group. The 'difficult trading environment', said chairman Richard Allan, had led to a fall in pre-tax profits to £3.1 million, a 36% slump compared to the first six months of the previous year (1998: £4.9m), with turnover down to £241.9 million (1998: £269.9m).

Allan also warned of difficult conditions ahead due to uncertainties surrounding the twice-yearly plate change which he fears may not produce the traditional upturn in business previously associated with August trading. 'Over-supply will continue to have an adverse effect on margins and a major realignment in new car prices, with far reaching impact for our business, grows ever more likely,' he said.

On the positive side Perry's Nationwide Accident Repair Centres, Allan said, had a stable £4 billion market to attack.

Interim turnover from the motor trade operations was down 18%, from £228.2 million to £187.1 million, partly as a result in the reduction in low margin fleet sales, and while new car retail volume increased by 3% (4,356 to 4,508 units), fleet sales were 44% lower (6,462 to 3,594 units). Meanwhile, Perry Contract Hire delivered a performance above expectations, with turnover up from £4.9 million to £5.4 million, although a predicted reduction in disposals meant that its profit contribution was well below the previous year (£330,000 down to £151,000 before tax).

Leave a comment for your chance to win £20 of John Lewis vouchers.

Every issue of Fleet News the editor picks his favourite comment from the past two weeks – get involved for your chance to appear in print and win!

Login to comment

Comments

No comments have been made yet.

Compare costs of your company cars

Looking to acquire new vehicles? Check how much they'll cost to run with our Car Running Cost calculator.

What is your BIK car tax liability?

The Fleet News car tax calculator lets you work out tax costs for both employer and employee