Vertu Motors (VTU) Trading Update summary

Market environment and trading performance

• New car market remains challenging due to the ZEV mandate, with BEV sales below government targets and heavy discounting impacting manufacturer profitability.

• Used car volumes grew 2.8% like-for-like, outperforming the broader market, though at slightly reduced margins.

• Aftersales operations delivered robust revenue and gross profit growth, supported by higher technician numbers and improved customer retention.

• Fleet car volumes rose 25.8% like-for-like, while commercial vehicle sales declined 9.9% amid weak business confidence.

• Motability vehicle sales fell 12.7% like-for-like, reflecting subdued consumer confidence.

Cost management and operational efficiency

• £10m annualised cost savings achieved ahead of FY27, with exceptional costs of £4-4.5m in FY26 due to headcount reductions and dealership closures.

• Core group expenses remained well controlled despite inflationary pressures.

• Efficiency initiatives included technology deployment, targeted headcount reductions, and reduced marketing spend.

Portfolio management and strategic initiatives

• Expanded Chinese brand representation with new BYD and Geely outlets, and plans for further growth with Leapmotor.

• Acquired Leicester Skoda and opened Nottingham Skoda, while disposing of surplus properties and non-core dealerships.

• Surplus property disposals generated £1.8m in H2 and a further £3.5m receivable by mid-March, all above net book value.