Lookers reported a 33.9% increase in pre-tax profit during 2025 as cost savings from its post-acquisition efficiency programme helped offset continued pressure on new and used car margins.
The AM100 dealer group said underlying profit before tax increased 2.9% to £60.1m, while gross profit fell 2.9% to £545.7m as margins came under pressure across its new and used car operations.
Lookers operates 137 dealerships across the UK and Ireland, representing 39 vehicle brands, alongside fleet, leasing and daily rental businesses.
The 2025 results, reported on Companies House, are the second full-year accounts since Lookers was acquired by Global Auto Holdings Limited (GAHL) in a £504m deal completed in October 2023.
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Ambitions to ‘the number one dealer group in the UK’
The company said its ambition is to become “the number one dealer group in the UK”, growing sales and servicing volumes while delivering stronger margins, high customer satisfaction and closer manufacturer partnerships.
It said the strategy will be supported by operational improvements, technology investment, expanding franchise relationships, developing aftersales and ancillary revenue streams, and growing its fleet and leasing businesses.
Lookers said growth in fleet deliveries helped drive a 9.3% increase in new vehicle volumes, significantly outperforming the wider market.
However, the greater mix of fleet sales actually resulted in reduced average selling prices, contributing to a 1.8% fall in new vehicle revenue.
Used car volumes increased 2.3% to 76,754 units, while used vehicle revenue grew 5.2% to £1.75bn, helped by higher average selling prices. Used vehicle gross margins reduced from 5.6% to 4.9%, which the business attributed to changes in demonstrator provisioning.
Aftersales revenue fell 5.0% to £363.4m, with Lookers citing dealership closures and structural changes in the UK vehicle parc.
Leasing and other revenue increased 21.6% to £201.3m.
Operational efficiencies and cost saving initiatives
Following the takeover by GAHL in 2023, the group launched a major efficiency programme that resulted in redundancies as it sought to simplify the business and reduce its cost base.
The company said operational efficiency and cost-saving initiatives reduced underlying operating costs by £14.6m during the year.
Together with finance costs falling by £3.2m, this offset a £16.1m reduction in gross profit and supported higher underlying earnings.
Reported pre-tax profit also benefited from lower non-underlying costs, including £8.1m of gains on property disposals.
Operating cash inflow increased to £163.9m from £106.8m in 2024.
Overall cash flow improved to an inflow of £20.7m compared with an outflow of £10.5m the previous year, driven by stronger operating cash generation, lower capital expenditure and higher disposal proceeds.
During the year, Lookers agreed to roll out the Pinewood Automotive Intelligence platform across its dealership network.
Implementation began during the second half of 2025 and is expected to be largely completed by the end of 2026.
Looking ahead, the company highlighted several risks facing the business, including economic conditions, changing demand for electric vehicles, the growth of Chinese vehicle brands, tariffs, and ongoing recruitment challenges for technicians.
It said it has expanded its manufacturer portfolio to include BYD, Changan and Geely in response to changing customer demand.