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UK Dealerships: Financial Key Ratios

Motortrader.com reports the average UK motor retailer produced a profit of just over £42,000 in June, the same as last year on increased turnover.

Dealers generated a return on sales of 1.21% compared to 1.33% in June last year, according to figures from dealer profitability specialist ASE.

“With profit on a par and turnover up, as a result of increased registrations, we therefore see a significant drop in the return on sales percentage compared to the prior year.

“This reflects the fact that dealers are having to work harder to generate the same return with a larger volume of transactions and this is expected to continue,” said ASE chairman Mike Jones.

Jones said profitability for the first half of the year was on a par with the prior year, albeit with a slight fallback in the second quarter. It is far too early to blame this on the impact of Brexit as the results contained one week of post-vote trading. 

Jones said that used car return on investment fell in June as a result of increased stock holding reflecting the impact of unsold self-registered vehicles arriving into stock.

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