RECORD RESULT DRIVES EAGERS HIGHER
EAGERS Automotive shares rallied after the nation’s largest auto retailer reported a record underlying profit and dividend, plus a strong order book.
Eagers said demand for new vehicles continued to outstrip supply as the sector transitioned to a “new normal” as written orders for new cars increased, although at a slightly slowing pace.
The company on Thursday reported record underlying operating profit before tax of $405.2m for the 12 months to December 31, from $401.8m a year earlier. But revenue slipped 1.4 per cent to $8.54bn.
Eagers will pay a record final dividend of 49c a share, up from 42.5c, payable on March 16. Major shareholder Nick Politis, with a 27 per cent stake, will pocket almost $35m in dividends.
Statutory net profit fell to $324.3m, from $330.7m a year earlier.
Eagers shares soared almost 9 per cent to $13, making it the best performer on the ASX 200.
The successful acquisition and integration of the ACT and South Australia multifranchised dealership groups also bolstered earnings. The 2022 result included significant items of $37m net income before tax, predominantly relating to the gain on the sale of Bill Buckle Auto Group.
Eagers CEO Keith Thornton said the company’s record full-year underlying profit reflected the strength of ongoing market dynamics combined with its reset and more productive operating platform.
“Our record dividend underlines the confidence the board has in our outlook for 2023 and beyond,” he said. “The industry is at an inflection point and Eagers Automotive is uniquely positioned to capitalise on its scale and expertise while leading the generational shift towards a lower-emission future.”