By Douglas Busvine
BERLIN -German used-car platform AUTO1 Group SE on Friday reported record second-quarter revenue of more than 1 billion euros ($1.18 billion), buoyed by new retail brand Autohero.
The company's results prompted a revenue upgrade, though its margin guidance was trimmed slightly, reflecting AUTO1's drive to invest in growth as more people buy cars online rather than visiting dealers and going for a test drive.
"We want to invest more, we want to invest faster," CEO Christian Bertermann told Reuters.
AUTO1, which listed in Frankfurt in February, raised its full-year revenue guidance to between 4 billion and 4.4 billion euros - up 200 million euros from its previous view. Its adjusted EBITDA margin is now expected to be slightly lower at between -2.5% and -3%.
Second-quarter revenue grew by 164% year on year and by 18% from the previous quarter as markets bounced back from lockdowns imposed across AUTO1's European markets in the early stages of the COVID-19 pandemic.
Gross profit, a measure of the money made on car deals, rose 15% quarter on quarter to 99 million euros - the highest in the Berlin-based company's nine-year history. Even so, AUTO1's Frankfurt-listed shares were down 3% by 0820 GMT.
AUTO1 offers a platform for merchants to trade used cars in 30 European countries but it is focusing on expanding Autohero, its direct-to-consumer business. Autohero sold 8,400 cars in the quarter - a sevenfold increase from a year earlier.
It narrowed its guidance for merchant sales to 554,000-580,000 vehicles this year while raising its projection for Autohero to 38,000-43,000 vehicles.
AUTO1 will invest in increasing capacity to deliver direct to buyers, Bertermann said, adding that it would build out its refurbishment centres to ready 150,000-200,000 cars a year for Autohero.
A number of rivals, including Dutch-based CarNext, have announced bold plans to expand in Europe's online market for used cars, but for now AUTO1 says they do not pose a direct challenge.
"We are aware that the competition is very loud, but we aren't yet aware of the competition on the ground," Bertermann said.
($1 = 0.8458 euros)
