The Glasgow-headquartered chain of dealerships sold 72,500 new cars last year, a decline of 6.6 per cent that kept turnover in check at about £2.3 billion. However, pre-tax profits increased to £51.8 million, boosted by higher sales prices for used cars which have become increasingly scarce.
The group was also helped by another record performance in its finance division, where turnover was nearly 4 per cent higher at £161m.
Sir Arnold Clark, who opened his first showroom in Glasgow’s Park Road in 1954, described the figures as an “excellent set of results” in what continues to be a difficult market. Retail sales across the industry fell by 14 per cent last year, versus a decline of just 8 per cent for the Scottish chain.
Meanwhile, fleet sales – a relatively small proportion of the business – were static during the year.
In the chairman’s statement accompanying the accounts, Clark said he was “confident” the group would continue to prosper despite the uncertain economic outlook that has seen the UK take a second dip into recession. Trading for the first part of this year was said to be promising, with an increase in turnover and steady profits anticipated for the whole of 2012.
“The group remains exceptionally well-funded and this will allow us to take advantage of any acquisition or investment opportunities that may arise in the coming year,” Clark said.
The company has found plenty of such opportunities so far in 2012, snapping up 18 additional branches in recent months to take the total number of franchises to just shy of 170.
The most recent deal, announced earlier this month, was the multi-million acquisition of 11 showrooms from John R Weir, giving the group Mercedes-Benz outlets in Aberdeen, Dundee, Grangemouth, Inverness and Perth. Arnold Clark has also completed a number of transactions in England, including deals for branches in Blackpool, Kendal and Morecambe.
The group’s headcount edged some 2 per cent lower in 2011 to a monthly average of 8,087. More than 150 jobs were shed in the company’s servicing division, and there were 50 fewer people working in office, management and sales posts.
However, the overall employment figure will have since gone up in line with acquisitions, including about 320 staff that joined from John R Weir.
This year’s activity contrasts with a more muted story in 2011, when Arnold Clark bought just a handful of dealerships. Most of the group’s efforts were concentrated on development and refurbishment of existing sites, such as the overhaul of Skoda and Volvo showrooms in Inverness, the redevelopment of BMW and Mini dealerships in Irvine, and the launch of the UK’s first Kia “Red Cube” showroom in Northwich.
No dividend was declared for 2011, reversing the previous year’s pay-out of nearly £1.8m. The highest-paid director – assumed to be chairman and chief executive Clark – received £1.93m in total emoluments, up from £1.73m previously.