Marshall Motor shares rise as board expresses Brexit caution

13th Mar 2019 14:27

(Sharecast News) - Automotive retail group Marshall Motor Holdings reported a 1.2% improvement in like-for-like revenue in its final results on Wednesday, to £2.14bn.The AIM-traded firm said its gross margin remained "strong" in the year ended 31 December, at 11.7%, while its continuing underlying profit before tax rose 1.2% to a record £25.7m.Like-for-like total new vehicle unit sales were down 8.2%, which the board put down to the impact of the Worldwide Harmonised Light Vehicle Test Procedure (WLTP), and challenges in the diesel vehicle market.It did see "strong" used car performance, with like-for-like unit sales up 2.3% and its margin up 32 basis points.There was also further like-for-like after sales revenue growth of 2.3%, with the overall margin there impacted by a mix of lower margin parts sales.Marshall Motor said management initiatives in the year helped to mitigate ongoing cost headwinds.The board claimed a "strong" balance sheet, with an increase in net assets to £200.4m, or £2.57 per share, after a £9.3m goodwill impairment.That was underpinned by £125.3m of freehold or long leasehold property, and "minimal" net debt.It was said to be "another year" of "strong" operational cash generation, which the directors said supported further capital investment of £23.8m.Marshall Motor also confirmed a revised dividend policy of between 2.5x and 3.5x, from between 4x and 5x, given its strong financial position and confidence in its long-term prospects.That lead to a 33.4% increase in the company's full-year dividend to 8.54p per share."Despite challenging new and used car markets, the group performed strongly, exceeding last year's record result at continuing underlying profit before tax level with overall like-for-like revenue growth," said Marshall Motor chief executive officer Daksh Gupta."In light of the group's strong financial position and confidence in its long-term prospects, we are pleased to announce a change to our dividend policy and a 33.4% increase in our full year dividend to 8.54p per share."Gupta said the board had noted the latest forecast by the Society of Motor Manufacturers and Traders (SMMT) for a further decline in the new car market in 2019, adding it was cognisant of the potential impact that the UK's withdrawal from the European Union could have."The board therefore remains cautious about the economic outlook for 2019."Our order book for the important March plate-change period is, however, encouraging and our outlook for the full year remains unchanged."I would like to take this opportunity, on behalf of the chairman and the board, to thank our entire team, our brand partners and suppliers for their continued support."As at 1349 GMT, shares in Marshall Motor Holdings were up 5.36% at 167p.