Busi­ness In­sight

Vertu Mo­tors

The Daily Telegraph - Business - - Business Comment -

Ster­ling’s weak­ness put the brakes on car re­tailer Vertu Mo­tors’ shares as the drop in the cur­rency made the cost of im­ported cars rise, writes Bradley Ger­rard.

The Gateshead-based firm said the sup­ply of new cars to the UK had been hit by the pound’s drop against cur­ren­cies such as the euro, Ja­panese yen and Korean won and pushed prices of cars made in these coun­tries up for British buy­ers.

Man­age­ment also said un­cer­tainty sur­round­ing the gen­eral elec­tion and Brexit had con­trib­uted to “the most volatile con­sumer en­vi­ron­ment” the com­pany had seen since the eu­ro­zone cri­sis in 2013.

While pres­sures were ev­i­dent in the six months to the end of Au­gust, such as mar­gins be­ing squeezed in its used car busi­ness, the con­tin­ued rise in sales from fac­tors such as post-pur­chase ser­vic­ing gave man­age­ment con­fi­dence to in­crease the div­i­dend by 10pc to 0.55p per share.

And the com­pany will buy back £3m of shares on top of the £1.6m it has al­ready spent.

Vertu has also said it will sell and lease back some of its car show­rooms to free up some cash, which rose to £20.8m in the pe­riod un­der re­view.

Vertu Mo­tors has blamed ster­ling’s weak­ness for higher car prices

Robert For­rester Chief ex­ec­u­tive

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