The AM100 car dealer group Caffyns has posted a £4.5 million swing into losses despite being able to increase its sales of new and used cars in 2023.
Its report to the London Stock Exchange revealed pre-tax losses of £1.5 million compared to the £3.1m profit it earned in 2022, when profits were already in decline, while revenues had risen 4% to £262 million off the back of a 5% rise in new car sales volume and a 2% uplift in used car volumes.
The underlying 2023 losses at Caffyns, which operates dealerships for brands including Audi, Lotus, MG, Seat/Cupra, Skoda, Volkswagen and Volvo, amounted to £0.6 million versus £3.1m the previous year.
Its banking partner HSBC has introduced new covenant “hurdles” requiring the business to focus on quarterly EBITDA targets in the year ahead.
“Trading for new cars and aftersales remained robust,” said chief executive Simon Caffyn, “however, the used car market suffered a significant price correction in the final calendar quarter of 2023 which, along with interest rates and energy costs at elevated levels and inflationary pressures on the cost base, had a detrimental impact on our second half performance.”
Login to continue reading
Or register with AM-online to keep up to date with the latest UK automotive retail industry news and insight.