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Inchcape motors to healthy FY profits; sees tough 2018
Car dealer Inchcape said full year pre-tax profit rose by 33% to £370m on a constant currency basis due to a strong distribution performance in Asia and emerging markets.
Revenue rose 9.4% to £8.9bn and the full year dividend was lifted by 12.6% to 26.8p a share.
However, the company said it expected "a more challenging year" in 2018. because of continued supply and demand imbalance in its retail markets particularly over the first half of the year.
There was also new vehicle decline in Singapore, "despite continued momentum across the rest of our businesses", said chief executive Stefan Bomhard.
"Overall, we expect to deliver a resilient constant currency performance over 2018," he said.
Bomhard said Inchcape's retail had a "more challenging" 2017 with growth in new car sales slowing in some developed markets.
"The UK market declined in the second half of the year, putting pressure on margins. Both the Australia and UK Retail markets were also impacted by the product cycle of some brands that we represent," he said.
"In Russia, by contrast, pleasingly we saw strong trading profit recovery largely supported by progress with Ignite in the region."
"Our distribution business achieved strong organic growth, boosted by the successful integration of our business in South America, acquired in 2016, which has seen a trading profit performance ahead of plan."
"Our distribution activities now contribute towards 80% of group profit, and are our strategic focus for future growth.""We embedded operations for Subaru in four new markets and gained market share in New Zealand as well as Australia, where we also successfully integrated the Peugeot and Citroën Distribution operations of Groupe PSA into our business."