Year End Trading and Strategy Update

RNS Number : 3948H

Motorpoint Group plc

06 April 2022

 

6 April 2022

Motorpoint Group PLC

("Motorpoint" or the "Group")

Year End Trading and Strategy Update

Good progress against strategic objectives, with strong advancements in technology, branch expansion and market share growth

Motorpoint Group PLC, the UK's leading independent omnichannel vehicle retailer, provides the following update on its performance for the full year ended 31 March 2022 ("FY22").

Year End Trading Update

The Group expects to report revenues of c.£1,320m (FY21: £722m), an increase of c.82% against FY21.

· Retail units grew by c.45% on FY21 despite the well documented reduced supply of vehicles during the period.

· Auction4Cars.com wholesale units grew by c.35%.

· We continued to grow market share, and in the nine-month period to December 2021, our share of the 0-4 year old market was 3.0%, compared to 2.6% in the previous year.

· Net Promoter Score, measuring customer satisfaction, was a record 84 (H2 FY21: 83).

As planned, strategic capital and operating costs increased in FY22 as we further invested in future growth with priority placed on technology and marketing. Notwithstanding these investments, the Group anticipates reporting Operating Profit and Profit Before Tax for the year in line with the Board's expectations.

Strategy Update

In June 2021, we announced our objectives to significantly increase our rate of growth, with the aim of at least doubling FY20 revenue to over £2bn in the medium term, by:

· Growing our E-commerce revenue to over £1bn by substantially increasing investment in marketing, technology and data.

· Opening 12 new sales and collection branches to service revenue growth, increasing investment in the customer proposition, and expanding our supply channels.

· Leveraging our E-commerce platform Auction4Cars.com to accommodate new supply channels and to launch our marketplace offering.

· Increasing operational efficiency through further automation and technology investment as customers migrate to E-commerce channels.

We are making good progress against these strategic objectives.

Around 58% of transactions were online in FY22 (FY21: 69% which was inflated by branch lockdown closures). E-commerce revenue grew to c.£600m (FY21: £419m).

Three new branches opened successfully in the second half of FY22, namely Manchester, Maidstone and Portsmouth, each strategically significant regions for the Group. The future pipeline remains strong and further openings can be expected in FY23 as we expand our geographical footprint to increase market share.

In line with our objective to leverage E-commerce platforms to expand our supply channels, the Motorpoint car buying service is now a fully automated digital first offering and payments are made to sellers within minutes of the vehicle being received. During FY22, 17.9% of retail vehicles sold were sourced from consumers (including part-exchange) (FY21 - 8.3%). Our Auction4Cars.com trading platform has now been successfully upgraded to operate as an automated marketplace to include third party vendors. This will be fully launched to further new vendors in FY23 and will enable them to auction their own vehicles digitally. We are excited by the opportunity this presents and look forward to providing further details in due course.

Execution of these strategic objectives provides further evidence of Motorpoint's agility and capability to implement new initiatives at pace and react quickly to market opportunities. Motorpoint is focused on leveraging its exceptional industry knowledge to continue increasing its market share across all channels, accelerated by investment in digital transformation.

While pursuing these medium-term objectives we increasingly appreciate the significant changes to consumer buying expectations and the changes to the marketplace of used car retail. As the largest omnichannel used car retailer, we are excited by the opportunity to lead, but we also embrace the amount and pace of change required at Motorpoint to seize this opportunity. 

During the first half of FY23, we will continue to execute our medium-term growth plan, while adding experienced leaders and teams in strategic areas. We expect to announce new technology leadership early in the financial year. As our leadership team is formed around our digital and omnichannel future, we will engage in crafting a long term, transformational strategic plan that extends our market leadership and delivers meaningful shareholder value. 

Outlook

The impact of rising inflation and worldwide vehicle supply challenges is likely to affect our markets and our company performance, but its extent is difficult to predict in the short term. However, we expect rising inflation will place further pressure on discretionary spending power and consumer sentiment. In this uncertain environment Motorpoint will continue to invest in revenue and market share growth, in strategic future capabilities and in providing an exceptional omnichannel customer experience.

Mark Carpenter, CEO of Motorpoint, said:

"Despite the uncertain consumer outlook, the Group's continuing confidence allows it to invest in its future growth strategies across multiple initiatives. The expansion of our technology team dramatically increases our capability to innovate and scale our Motorpoint.co.uk and Auction4Cars.com platforms which both have huge future growth potential. Motorpoint is the UK's largest independent omnichannel vehicle retailer, and our value-based proposition continues to resonate as much today with our customers as it did 24 years ago. We remain confident in our medium-term strategic objectives and are excited in our potential to grow substantially as we continue to invest in our brand, infrastructure and technology."

Enquiries:

Motorpoint Group PLC Mark Carpenter, Chief Executive Officer Chris Morgan, Chief Financial Officer	via FTI Consulting
FTI Consulting (Financial PR) Alex Beagley Sam Macpherson Harriet Jackson Amy Goldup	020 3727 1000

Notes to editors

Motorpoint is the UK's leading independent E-commerce led omnichannel vehicle retailer, focused on giving retail and trade customers the easiest, most affordable and seamless way of buying, selling and financing their car whether online, in-store or a combination of both. Through its leading B2C platform Motorpoint.co.uk and UK network of 17 sales and collection branches, the Group provides an unrivalled offering in the nearly new car market, where consumers can effortlessly browse, buy or finance their next car and collect or have it delivered directly to their homes. Motorpoint's purely online wholesale platform Auction4Cars.com sells vehicles into the wholesale B2B market that have been part exchanged by retail customers, or purchased directly from them by the Group as part of its online car buying service. Motorpoint's diversified business model, underpinned by its established brand, industry leading technology and sophisticated marketing infrastructure, always delivers the best value, choice, quality and service for customers. The Group is proud to have been recognised for seven consecutive years as one of the Sunday Times' Top 100 Best Companies to Work For.

 

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