Interim Management Statement

RNS Number : 8328A

Caffyns PLC

08 February 2011

 



8 February 2011

Caffyns plc ("Caffyns" or the "Company")

INTERIM MANAGEMENT STATEMENT 

This Interim Management Statement by Caffyns plc covers the period from 1 October 2010 to 7 February 2011("the Period").

Performance

During the four months ended 31 January 2011, the Company's unit sales of new cars were 17.9% down on the equivalent period in the previous year on a like-for-like basis. The total new car market in our sector has fallen by 28.4% on the prior year's equivalent period, indicating that Caffyns continues to gain market share. Excluding sales under last year's scrappage scheme, new car unit sales were up 29.0%.

Used car unit sales increased by 11.3% in the four month period and aftersales turnover was up 2.3% on a like-for-like basis, despite the effect of the harsh winter weather throughout the south-east of England in December.

Focus on core businesses

To support the Company's ongoing strategy of improving performance across the core businesses, we have taken a number of actions to enhance our operational efficiency. We have now sold our Citroen dealership in Uckfield and have closed a small Ford business in Haslemere. These changes have not had a material impact on the Company's cash position but have incurred approximately £200,000 of exceptional charges.

We are also in the process of closing three other under-performing businesses - a bodyshop in Hailsham, a Nissan/Chevrolet dealership in Eastbourne and a bodyshop in Tunbridge Wells. The Board of Caffyns anticipates that these closures will be completed before the year-end and will incur additional exceptional costs of approximately £750,000, largely comprising redundancy and other closure costs. Therefore, as a result of the disposals completed during the Period and those anticipated to complete before the year-end, the Board expects the Company to report total exceptional charges of approximately £950,000 for the year to 31 March 2011. These disposals are expected to have a positive cash impact and should enhance trading profit next year.  Cash realised from sales of properties will be invested in our premium and premium-volume dealerships to continue our strategy of modernisation towards larger and more profitable sites.

Stronger future

While consumer confidence is clearly central to the financial performance of the Company, the actions we are taking to remove under-performing dealerships, to reduce costs generally and to invest in larger, more modern facilities will provide a stronger portfolio of businesses for the future.  

Enquiries:

Caffyns plc	Simon Caffyn, Chief Executive	Tel:  [phone]
	Mark Harrison, Finance Director
The HeadLand Consultancy	Howard Lee	Tel:  [phone]
	Tom Gough

For further information visit www.caffynsplc.co.uk 

 

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