Auto Trader warns of weaker outlook despite profits rise
Online car ads firm Auto Trader has reported a ten per cent rise in its full year results to £243.7m, but its shares dipped as it warned of a weaker outlook for the year ahead.
The company said full year revenue also rose eight per cent to £355.1m.
While it expected another strong year of growth in 2019, it said it would not be at the “exceptional levels” seen so far.
"We have achieved another strong year of revenue and profit growth driven by a line-up of products that are proven to improve the business performance of our retailer and manufacturer customers,” said Trevor Mather, Chief Executive Officer of Auto Trader Group plc.
"We remain the most trusted marketplace for car buyers and offer the largest choice of both new and used cars following the recent addition of brand-new cars on Auto Trader, which are available immediately and at competitive prices.
"The new financial year has started well, and despite the continued wider market uncertainty, the Board is confident of meeting its growth expectations for the year."
However, in its full year report the company also said: “We anticipate average retailer forecourts to be flat year on year.”
Although it said consumer services improved in the second half of last year which it expects to continue, it added that: “[D]ue to the challenges facing Manufacturers and their agencies, we expect revenue from these customers to decline in the first half of the year.
No Brexit impact
Auto Trader also said it was not expecting to see “any issues with Brexit affecting our ability to provide our services, or to materially change our cost base”.
The Manchester-based online car marketplace has invested in its core platform and infrastructure, including a new public cloud-based solution to improve its security, resilience and speed when it comes to releasing software.
Its manufacturer and agency revenue grew due to its InSearch product, which allows manufacturers to advertise cars within its main search.
The digital retailer said that across the year, its marketing spend had increased by eight per cent to £17.6m.
Auto Trader’s shares were trading 1.4 per cent lower mid morning Thursday at £5.78
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