The John Clark Motor Group has reported a significant upturn in its latest annual accounts for 2009, which have just been published. While turnover was maintained at a similar level to 2008, the group’s operating profit improved from £1.8 million to £2.8 million.
Combined with a significant reduction in interest costs, this resulted in a pre-tax profit of £1.7 million compared to a loss of £480,000 in the previous year.
Commenting on the results, John Clark, Chairman and Managing Director of the John Clark Motor Group, said:
“Following a period of expansion and acquisition in 2008, our primary focus through 2009 was to react to the mix of challenges and opportunities that resulted from the recession.
“The unprecedented economic downturn in the second half of 2008 continued into early 2009. We implemented measures aimed at stabilising the group during those difficult times. This meant we were able to minimise an unfortunate but essential reduction in staff numbers.
“At the same time, the management teams, at group and dealership levels, responded positively to the challenge of improving working capital controls and resultant cash liquidity. This has been reflected in the lower interest costs during 2009 and the significant reduction in borrowings over the period.”
The John Clark Motor Group reports that its new vehicle sales for 2009 were ahead of budget. But, reflecting the trend in the wider marketplace, sales were 10% down on the record levels it attained in 2007 and 2008. Used vehicle sales during 2009 increased by 12%.
“While the government’s contribution to the scrappage scheme supported the industry as a whole, its benefits were less for the prestige brands that we represent,” John Clark points out. “The temporary reduction of VAT to 15% was also beneficial, but to a limited extent.
“The outlook for the rest of 2010 and into 2011 remains challenging. But, our mid-year results were again ahead of budget. We shall continue to focus strongly on growth in after-sales services, operating cost levels and working capital controls.
“With a stronger balance sheet, thanks to the groups return to profit and the reduction in our borrowings, I believe we are in a good position to take advantage of future opportunities.
“Having purchased Clark Commercials in Aberdeen, during 2008, the downturn in the commercial vehicle market was extremely disappointing. The group has made significant investment in light commercials, both in Aberdeen and at its Volkswagen Van Centre in Edinburgh. Reacting to the market downturn has led to a number of operational changes and we fully expect to see improved returns from these investments in the future.”
During 2009 the John Clark Motor Group’s BMW dealership in Dundee was refurbished to the latest franchise standards and a new showroom constructed for Mini. Future developments include expansion with Land Rover in Edinburgh and the group is opening a new Specialist Cars Skoda dealership on Dundee’s Kingsway East.
The John Clark Motor Group is Scotland’s fourth largest motor group with 640 employees. The group represents BMW, Mini and Audi in Aberdeen and Dundee, Volkswagen in Aberdeen and Fife, Skoda and Seat in Aberdeen and Land Rover in Edinburgh. In addition it holds the Volkswagen van franchises in Edinburgh and Aberdeen.