Lithia UK increased operating profit by 37.5% to £101.2 million in 2025, supported by stronger dealership trading and business disposal gains.
The AM100 dealer group reported improved margins, procurement savings and lower duplicate costs as it continued to integrate its UK businesses.
Accounts for Lithia UK Holding show operating profit before other income and expenses rose 12.3% to £75.8m for the year ended December 31, 2025.
Statutory operating profit included £25.5m of gains from business disposals, compared with £14.8m in 2024. Other operating expenses fell from £9.3m to £1.3m.
Pre-tax profit increased from £21.7m to £60m, while turnover declined 2.3% to £5.36 billion.
The AM100 report will be published next month just after Automotive Management Live on November 11, but these latest results look likely to move Lithia into the top five largest dealer groups in the UK by turnover.
Dealership margins improve
The motor division increased operating profit before other income and expenses by 27.6% to £66.6m, despite revenue falling 2% to £5.25bn.
Its operating margin improved from 1% to 1.3%.
On a like-for-like basis, motor retail pre-tax profit rose 33% from £28.1m to £37.4m.
That comparison includes dealerships trading throughout both years and January 2024, when the former Pendragon motor business remained under its previous ownership.
The accounts attribute the improvement to common processes, sharing best practice, stronger margin retention, improved procurement terms and the removal of excess and duplicated costs.
Across the comparable motor retail business, which covered 20 brands and 124 locations, 14 brands recorded year-on-year improvements.
Directors said that, despite a more difficult year for several manufacturers, the results demonstrated stronger underlying trading performance.
Acquisitions and network changes
Lithia continued to reshape its dealership portfolio, acquiring businesses while closing underperforming operations and disposing of others outside its strategy.
Its acquisitions during the year included Hatfields, the JLR dealer group operating in the north of England.
The group also identified opportunities to grow aftersales through training and investment aimed at improving customer and employee retention, efficiency and workshop utilisation.
New retail vehicle sales increased 0.3% to 73,661, while used retail sales rose 0.9% to 107,533. Combined sales increased 0.7% to 181,194 vehicles.
EV residual values hit leasing profits
The leasing division faced a more difficult year, with like-for-like pre-tax profit falling from £13.2m to £6.9m.
Directors attributed the decline to a weaker used car market and increased returns of electric vehicles affected by falling residual values.
Operating profit before other income and expenses fell 39.9% to £9.2m, while leasing revenue declined 16.2% to £111.4m.
The group said it had taken action to mitigate those pressures. Its acquisition of Agility Fleet Holdings after the year end increased its customer base and fleet size, while providing opportunities for shared cost savings.
Lithia UK paid a £60m dividend to its US parent during 2025, compared with £50m the previous year.
Directors expect a continued focus on dealership profitability and an efficient cost base to support further improvements in underlying motor retail trading during 2026.