Arnold Clark selling 840 motors a day as turnover tops £4 billion

A bumper rise in used car sales at Scotland’s biggest dealership group Arnold Clark has offset the impact of a falling new car market and helped turnover top £4 billion for the first time.
Arnold Clark represents some 27 different manufacturers across its dealerships. Picture: Lisa FergusonArnold Clark represents some 27 different manufacturers across its dealerships. Picture: Lisa Ferguson
Arnold Clark represents some 27 different manufacturers across its dealerships. Picture: Lisa Ferguson

The Glasgow-headquartered group – which sold more than 840 cars every day last year – said it had also made a strong start to 2019 but warned that with uncertainty around Brexit, it expects market conditions to “continue to be challenging”.

Although industry-wide new car sales are expected to fall again this year, Arnold Clark – which represents 27 different manufacturers across its dealerships – said it expects modest growth in the used car market.

Hide Ad
Hide Ad

Growth in revenue of 7.8 per cent to £4.2bn during 2018 was mainly driven by a 9.5 per cent increase in used car sales to almost 240,000 vehicles.

Although new car sales dipped by 2.6 per cent to 68,344 cars, the company stressed that represented a significant outperformance on the wider UK market which saw a fall of 6.8 per cent, blamed on factors including new emissions testing regulations which disrupted manufacturers’ supply chains. Its vehicle hire arm saw revenues fall 6.9 per cent to £506.7 million.

Overall profits before tax returned to growth with a rise of 6.4 per cent to £113.5m, aided by operational efficiencies which led to margin improvements.

Dividends of £5.4m were paid to the Clark family during the year, up from £3.5m the previous year.

Chief executive Eddie Hawthorne said it had been an “excellent” performance during what had been a turbulent period for the motor industry.

He also highlighted the fact that group net assets topped £1bn for the first time which he said was a significant milestone for the group and a “testament to the vision and hard work” of founder Sir Arnold Clark. Staff numbers rose to 12,232 during the year, up from 11,427, with 300 apprentices taken on.

The pay package of the highest paid director – presumed to be Hawthorne – increased to £4.1m from £3.5m.

The group expanded its dealership network during the year, with moves including acquiring Kilmarnock Citroen out of administration and buying the Phoenix Motor group which operated franchises at Linwood, near Paisley.

Hide Ad
Hide Ad

Earlier this week fellow Glasgow-based dealership Peter Vardy also reported strong used car sales for 2018. The firm, which holds franchises for BMW, Jaguar Land Rover, Porsche and Vauxhall as well as two Peter Vardy CarStores, in Glasgow and Dundee, posted a 4.4 per cent increase in used ca sales for the year. Aftersales revenues held strong, leading to a 4 per cent rise in overall group turnover to £468m.

Figures out earlier this month showed that new car registrations across the UK had fallen for the six month running – 92,573 cars were registered in August compared with 94,094 last year.

Related topics: