European Motor Holdings trebles profits

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The Independent Online
EUROPEAN Motor Holdings, the motor dealer and car-wash supplier, trebled profits to pounds 2.6m before tax in the six months to 30 September, writes John Murray.

The group was put together after a reverse takeover of Cargo Control by Richard Palmer, who in the late 1980s transformed Western Motors from a pounds 5.5m company into one worth pounds 100m in three years.

Operating profits from the car dealerships, based mostly in the North of England, jumped 45 per cent to pounds 1.7m, on the back of the surging new car market. Mr Palmer, chief executive, said sales had held up well since the traditional August boost from new registrations.

European's Wilcomatic vehicle washing business contributed pounds 1.4m, after setting aside pounds 170,000 to settle the previous managing director's service contract.

Mr Palmer said he was constantly looking at potential acquisitions, but he believed the existing businesses could still deliver plenty of organic growth. The Wilcomatic division balanced the more volatile and cyclical motor retail business.

Borrowings as a proportion of shareholders' funds fell from 54 per cent at last year's interims to 32 per cent. Overall group turnover rose from pounds 50.3m to pounds 81.5m. The dividend is lifted 15 per cent to 1.725p on earnings per share of 4.9p (1.4p). The shares rose 1p to 132p.