Auto Trader still picking up the pace

SHARES in Auto Trader rose 3pc as Britain’s leading website for buying and selling cars raised profits forecasts.

The company said it expected full-year profits to be between £169m and £171m – better than the £164m expected by analysts.

Auto Trader’s shares rose 10.1p to 371.40p, valuing the company at £3.65bn.

The company has soared in value since Guardian Media Group, the owner of the Guardian and Observer newspapers, sold its 50.1pc stake two years ago for £619m.

That stake would be worth £1.8bn today. Auto Trader said it boosted earnings despite the number of advertisements remaining flat.

It has done this by making more money from each sale due to increased prices, as well as keeping costs down.

More than 400,000 cars are listed each day and the website plays a part in the sale of 65pc of all used cars in the UK, with over 80pc of all UK car dealers advertising on Auto Trader.

Guardian Media Group had been considering launching a similar venture in the north of England but bought the magazine, which was launched in 1977, instead.

Its first website was created in 1996.

In June 2013, the final print edition of Auto Trader rolled off the presses as the business switched strategy, becoming a 100pc digital operation.

In 2007 private equity firm Apax bought a 49.9pc stake, buying the remainder for £619m in 2014.

Just one year later Auto Trader was floated on the London Stock Market with a £2.35bn valuation.