Bonuses push Pendragon up a gear

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The Independent Online

Bumper City bonuses and the release of the latest Bond film helped boost sales of Aston Martins last year and lift the profits of Pendragon, Britain's biggest car dealer.

Trevor Finn, chief executive, said the new Aston Martin V8 was the "hot car" for its Stratstone chain of dealerships which also specialises in other upmarket brands such as BMW, Ferrari, Maserati, Lotus and Jaguar.

Record bonuses for top City traders created strong demand in London for high-powered performance cars although Mr Finn said sales were also buoyant in other cities such as Leeds, Manchester and Edinburgh. The launch of a new Ford Focus and Vauxhall Corsa also helped boost revenues at the group's Evans Halshaw volume car dealerships.

Underlying profits before gains from one-off profit sales rose 15 per cent to £68m following the takeover of the rival car dealer Reg Vardy, which has almost doubled Pendragon's turnover.

Shares in the group rose by nearly 7 per cent on relief that Vardy, bought last February for £504m, had been smoothly integrated while nearly two-thirds of the debt used to finance the takeover had already been paid off. Pendragon said the Vardy acquisition had also increased its presence in used cars which continue to perform more strongly than the new car market.

Mr Finn said that despite the failure of its subsequent bid for Lookers, Pendragon was on the hunt for further acquisitions and had already bought 16 dealerships since the Vardy deal. Analysts expect its balance sheet to be ready to finance another big takeover by the second half of this year should an opportunity arise. Mr Finn pointed out that although Pendragon was by far the UK's biggest car retailer, it still had a market share of only 5 per cent with some 400 of the country's 5,000 dealerships, leaving scope for further consolidation.