ONE of Scotland's largest motor dealers has reported a dip in profits, due to the troubles of the Saab car brand and start-up costs associated with new dealerships.
Eastern Holdings, which operates dealerships under the Eastern Western Motor Group banner, saw its turnover rise from £288.6 million to £324.5m in 2011.
However, according to accounts filed at Companies House, pre-tax profits declined from £5m to £3.3m.
The four Saab sites suffered a "massive decline" in turnover and gross profit when the Saab Great Britain business went into administration, leading to a lack of new models to sell.
Eastern Holdings, headquartered at Broxburn, West Lothian, said: "This resulted in a negative net profit contribution from a division which was previously very profitable.
"We have since refranchised two of our former Saab outlets with the Seat franchise and we are in discussions with other manufacturers regarding our two other dual franchise sites.
"These outlets will however remain as Saab authorised repairers."
The company, majority owned by director Douglas Brown, also said it had seen administration costs rise from £36.1m to £40m as a result of opening four new dealerships.
These dealerships were Lexus in Glasgow plus Mazda, Honda and Nissan in Edinburgh – at the end of 2010.
In notes to the accounts the directors said: "As we stated in our 2010 accounts we do not see any significant profit contributions coming from these new additions for up to two years until we build up their aftersales contribution."
The company said that poor consumer confidence meant the market for car sales was still extremely tough.
However it had seen greater profitability in its Mercedes Benz commercial vehicle arm.
A dividend of £800,000 was paid compared to £809,000 in 2010.
Director's emoluments increased from £199,000 to £225,000 with the highest paid receiving a rise in their rewards from £170,000 to £193,000.
Why are you making commenting on The Herald only available to subscribers?
It should have been a safe space for informed debate, somewhere for readers to discuss issues around the biggest stories of the day, but all too often the below the line comments on most websites have become bogged down by off-topic discussions and abuse.
heraldscotland.com is tackling this problem by allowing only subscribers to comment.
We are doing this to improve the experience for our loyal readers and we believe it will reduce the ability of trolls and troublemakers, who occasionally find their way onto our site, to abuse our journalists and readers. We also hope it will help the comments section fulfil its promise as a part of Scotland's conversation with itself.
We are lucky at The Herald. We are read by an informed, educated readership who can add their knowledge and insights to our stories.
That is invaluable.
We are making the subscriber-only change to support our valued readers, who tell us they don't want the site cluttered up with irrelevant comments, untruths and abuse.
In the past, the journalist’s job was to collect and distribute information to the audience. Technology means that readers can shape a discussion. We look forward to hearing from you on heraldscotland.com
Comments & Moderation
Readers’ comments: You are personally liable for the content of any comments you upload to this website, so please act responsibly. We do not pre-moderate or monitor readers’ comments appearing on our websites, but we do post-moderate in response to complaints we receive or otherwise when a potential problem comes to our attention. You can make a complaint by using the ‘report this post’ link . We may then apply our discretion under the user terms to amend or delete comments.
Post moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours.
Read the rules hereComments are closed on this article