(Reuters) – UK car dealing and repair group Pendragon on Tuesday stuck with its forecasts for a loss this financial year after it cut costs to tackle the impact of weakening car sales and consumer confidence.
The company, which operates the Evans Halshaw, Stratstone, Quickco and Car Store brands, said full-year underlying loss before tax is likely to be in line with its expectations.
The board said in June it expected a “small” underlying annual loss, but added in September that results would be at the lower end of its expectations as deep price cuts to offload used car inventory pushed it to a first-half loss.
However, Pendragon posted higher underlying pretax profit on Tuesday for the third quarter ended Sept.30.
“In our view, the drivers of the third-quarter results are sustainable and exit trends augur well for support of full year expectations, which should be welcomed by the market following persistent downgrades,” Jefferies analysts said.
The company, which has seen two chief executives leave this year, has been impacted by the woes of the British car industry, which is faced with weak sales, stricter emissions regulations and a shift towards sales of electric or hybrid cars.
With just nine days left for the United Kingdom to leave the European Union, the divorce is again in disarray as Britain’s politicians argue over whether to leave with a deal, exit without a deal or hold another referendum.
Quarterly revenue fell 8%, as sales from used cars in the UK fell, offsetting growth in its new car business.
Shares of the company were up 1.4% at 11.8 pence in early deals.
(Reporting by Pushkala Aripaka in Bengaluru; Editing by Arun Koyyur)