Multinational car dealer Inchcape posted a better-than-expected 10% rise in full-year profit, helped by strong growth in Asia – and Australia – and a robust performance in Britain.
It forecasts growth in the period ahead, with 70% of its group profit now coming from Asia Pacific and emerging markets, such as Australia.
The London-based firm, which sells and distributes cars for manufacturers such as Toyota, Mercedes-Benz and BMW in 26 countries, reported 2012 pretax profit of AU$364 million, up from $331.15 million a year earlier, on sales 4.4% up at $8.87 billion.
The company was expected to report an average pretax profit of $360.69 million.
The growth rate was slightly down on last year’s 13% rise but the company is now close to returning to levels of profit delivered at the market peak in 2007.
The company says its recent investment in high-growth and high-margin areas in Asia Pacific and emerging markets – including Hong Kong, Chile and Australia – were paying off.
Its South Asia business delivered a 31.6% rise in vehicle sales, helped by robust premium and luxury markets, with Australian car sales up 18.2%. Sales in Europe fell 23.5% as trading conditions, particularly in Greece, continued to be challenging but it achieved sales growth of 3.6% in Britain.
European car sales slumped to a 17-year low in 2012 with only Britain bucking the trend with 5.3% growth, although at just over 2 million vehicles, sales were still 15% below 2007 levels.
Inchcape said it was confident it would deliver further growth in 2013 given that 70% of its group profit now comes from Asia Pacific and emerging markets.
“Asia Pacific and emerging markets … are underpinned by population growth, wealth creation, increasing car penetration and industry premiumisation,” says chief executive André Lacroix. “We are confident that Inchcape will continue to produce sustainable earnings growth and strong returns for our shareholders.”
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