Car dealership Pendragon has warned over steeper-than-expected annual losses as it swung into the red over the first half after slashing prices to offload its used car inventory.

The group reported underlying pre-tax losses of £32.2 million for the six months to June 30 against profits of £28.4 million a year ago.

It said the losses came after efforts to shift a build-up in used car stock, combined with the impact of a fall in national used car prices of around 7% during the second quarter.

The group also cautioned that dismal market conditions meant underlying full-year profits are "now expected to be at the bottom of the board's expectations".

Pendragon also announced that non-executive chairman Chris Chambers will step down on October 1.

Non-executive director Bill Berman will take on the new role of executive chairman on an interim basis.

Pendragon revealed in its results that it would cut around 300 jobs and shut 22 of its 34 Car Stores sites, as well as a preparation centre in Stoke.

Shares in Pendragon tumbled 13% after the results.