Profits warning hits car dealers
Saturday 13 June 1998
Car Group shares plunged 44 per cent to 85.5p after the company said it had been hit by depressed demand in the used car market and an "exceptional two-month price fall". Peter Floyd, the company's finance director said prices on some models had fallen by 10 per cent in the last two months.
Car Group said its results for the year to August would be significantly affected, prompting analysts to cut their profit forecasts from pounds 7.6m to between pounds 4.5m and pounds 5m. The warning led to downgrades on rival car dealers such as Quicks. Analysts said that others such as Arriva, the former Cowie Group and Dixon Motors might also be vulnerable. Car Group's shares were priced at 138p when the company came to the stock market in November 1996.
The Car Group pioneered the concept of car supermarkets in the United Kingdom. All its sites, which trade under the National Car Supermarket name, are in the Midlands or the North and Mr Floyd said its base in Britain's manufacturing heartland was a factor in its problems. He said: "The strong pound has hit manufacturing industry and that is where we trade. The strong pound has also enabled manufacturers to offer good deals on new cars which may have affected demand on older models."
The company reduced stock levels but now feels prices might be settling and so has resumed normal purchasing patterns.
Car supermarkets are a growing phenomenon in the UK. A rival group CarLand launched to great fanfare in January. It is spending pounds 25m developing indoor car supermarkets. Most of Car Group's are outdoor sites.
- 1 Autistic teenager beaten up by bullies makes them watch 20-minute video about autism
- 3 World learns of app that shows you who unfriended you on Facebook, app promptly crashes
- 4 Chris Moyles reportedly set to make radio comeback with new breakfast show on XFM
- 5 The Greece debt crisis explained in less than 100 words
Florida man sentenced to two-and-a-half years for having sex on the beach in front of a child
Autistic teenager beaten up by bullies makes them watch 20-minute video about autism
Man who was struck and killed by lightning in Brecon Beacons 'was carrying a selfie stick'
Greece debt crisis as it happened: EU chiefs at loggerheads hours before Alexis Tsipras’s last ditch deal proposals
Florida teacher sentenced to 22 years in prison for sexually abusing three pupils
More Britons believe that multiculturalism makes the country worse - not better, says poll
Osborne to cap family benefits at £23,000 – announced ahead of his post-election Budget
Nathan Collier: Montana man inspired by same-sex marriage ruling requests right to wed two wives
Forget little green men – aliens will look like humans, says Cambridge University evolution expert
Girl, 7, stares down hate preacher at Ohio festival with pro-LGBT rainbow flag gesture
Sickness and disability benefits could be reduced by £30 a week as part of £12bn welfare cuts
iJobs Money & Business
£40000 - £95000 per annum: Recruitment Genius: This is an exciting opportunity...
competitive: SThree: Are you passionate about sales?Do you have a keen interes...
£17000 - £30000 per annum: Recruitment Genius: This is an exciting opportunity...
£15000 - £17000 per annum: Recruitment Genius: This company offers a range of ...