ONE of Scotland’s leading automotive companies, the Peter Vardy Group, has unveiled plans to focus on future trends in the industry including electric vehicles and new car agency models – systems for selling cars at a fixed price – as it increased turnover by 5% to £609 million last year, with earnings before tax of £16.1m.
In the year to December 31, 2022, performance within the motor group remained “relatively static except for significant cost increases” with its businesses generating a turnover of £590.5m, up from £560.7m in 2021 and reflecting a year-on-year uplift of 5.3% and earnings before tax of £11.9m (£15.7m in 2021).
But the group said that although turnover increased, profitability was impacted due to “significant factors” including a reduction in used car supply and the resulting “margin erosion”. Eight of the group’s retail outlets are CARZ used car supermarkets and last month it announced a decision to close two in Dundee and Glasgow.
Increased operating costs, most notably interest rates, business and utilities rates and rising employment costs also impacted the group’s margin.
The Peter Vardy Group, which remains a family-run business and is headed up by chief executive Peter Vardy, has evolved from a single dealership in Perth in 2006 to a multifaceted organisation with diverse divisions including luxury cars, volume supermarkets, a new mobility division, and a fast-growing car finance broker, CarMoney.
In addition to highlighting EVs and new car agency models, a recent strategic review of the group’s operations earmarked new manufacturer entrants and evolving mobility trends as future trends. “The board believes that 2022/23 are pivotal years in the group’s transformation journey, and investments made during this period will enable scalable growth in the coming years,” the company noted in its trading statement.
The statement added: “The group’s balance sheet now demonstrates net assets of £97m, reflecting its unwavering commitment to excellence and innovation in the automotive industry and its future looks increasingly exciting, underpinned by its enhanced leadership capability and access to funds.
“It has secured a revolving credit facility for £25m for a period of three years, with an option to extend for an additional two years and a £10m accordion. Combined with used vehicle stocking facilities of £70m, this provides the group with access to £105m in funding.
“These financial resources position the group for substantial growth, aligning perfectly with its 2030 vision.”
The mobility division, the group said, launched in 2021, is integral to the group’s 2030 strategy. Peter Vardy revealed that with the group’s leasing broker offer the mobility division is its most successful start-up, adding: “It is therefore a business the board has signalled for significant growth in 2023.”
It also noted that its rental business, launched in January last year, has seen “remarkable growth, finishing 2022 with 630 vehicles on fleet, over 90% utilisation, and contributing a profit in its first year”.
New car contributions were up by 79.6% – or £3.9m – year on year. CarMoney, it noted, delivered record-breaking financial performance, generating a turnover of £18.7m, representing a year-on-year uplift of 73%.
The statement also revealed that the group provided a one-off cost of living bonus to all staff, at a cost of £1m to the business, with this contributing to an increased cost of £4.6m during the financial year.
READ MORE: Scottish car dealer Peter Vardy posts best results in its 15-year history
Peter Vardy Group sells brands including Porsche, Jaguar, Land Rover, BMW, Mini, MG and Ora alongside its used cars operation CARZ.
It donates 10% of its annual group profits to good causes in the UK and internationally via The Peter Vardy Foundation. The group also founded and continues to support Gen+, an online leadership programme for all schoolchildren in Scotland which is currently being taught in 40 schools.
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