Auto Trader profits jump on ‘record’ car buyer numbers

Auto Trader Group shares rose sharply on Thursday after the firm unveiled a 12 per cent year-on-year rise in first-half revenue to £280.5million.

The FTSE 250 group credited a resilient used car market, which drove record numbers of buyers to its platform over the period. 

Auto Trader’s operating profit reached £164.6million in the first half, representing a 10 per cent increase by the same point a year ago. 

Auto Trader shares were up 7.68 per cent or 48.80p to 684.20p on Thursday, having risen over 20 per cent in the last year.    

The company’s operating profit margin remained stable at 71 per cent, while its margin dipped one percentage point to 59 per cent. 

Basic earnings per share increased by 4 per cent to 12.74p, as the group generated cash from operations of £184.2million, up 12 per cent on a year ago. 

EBITDA rose 9 per cent to £182.1million, and adjusted earnings per share climbed 2 per cent to 13.96p.

The growth in average revenue per retailer by 12 per cent was attributed to the continued adoption of additional products and services and a successful pricing and product event in April, Auto Trader said. 

The integration of the new car leasing proposition, Autorama, was underway, the group said, yielding cost savings and anticipating volume growth when supply returned to the channel.

Looking ahead, Auto Trader said it was confident in the second half, as recurring revenue remained stable, and the first-half growth event successfully executed.

Auto Trader’s operating profit margin is expected to hold firm, while group margins are expected to increase year-on-year.

The group said its capital policy remains focused on returning surplus cash to shareholders through dividends and share buybacks.

Chief executive Nathan Coe, said: ‘It has been a strong start to the year with more buyers spending more time and completing more of their car buying journey on Auto Trader.

‘We are working in partnership with record numbers of retailers and manufacturers, who are turning to our platform as the most effective and efficient way to source, price and sell their vehicles.

‘We remain confident in our long-term prospects given the strength of our business and the opportunities to deliver meaningful value for car buyers, customers, our people and shareholders.’