Auto Trader shares hit record high as FTSE 100 group cashes in on ‘robust’ second-hand car demand

Auto Trader Group shares rose sharply on Thursday to a record high after the business posted higher profits and revenue for last year. 

The group’s revenue increased by 14 per cent to £570.9million, amid a ‘robust’ second-hand car market continues to enjoy higher demand than before the pandemic. 

Auto Trader sales rose 12 per cent to £529.7million, while leasing specialist Autorama saw a 51 per cent increase to £41.2million.

Auto Trader shares jumped 12.4 per cent or 90.6p to 821.20p on Thursday, having risen over 30 per cent in the last year. 

Pre-tax adjusted earnings before interest, depreciation and amortisation grew 14 per cent to £375.3million, while pre-tax profits jumped 18 per cent to £345.2million.

The London-listed group said over 75 per cent of all minutes spent on automotive classified sites were spent on Auto Trader during the year, unchanged on 2023.

Like-for-like retailer numbers edged up 1 per cent, after the impact of the Webzone disposal in the previous year was stripped out.

Average revenue per retailer grew 12 per cent to £2,721 on average per month, boosted by continued uptake of additional products and services.

Auto Trader said the ‘robust’ used car market seen in the year was expected to continue into the current year.

The group said: ‘Demand is resilient, with cars continuing to sell faster than before the pandemic and used car supply has gradually improved.’

It added: ‘Trade prices softened in the latter months of the calendar year, which subsequently impacted retail prices, but monthly pricing movements have since stabilised in line with typical seasonal trends.’

It also noted that that the current financial year had ‘started well’ and forecast ‘another good year’ of average revenue per retailer growth.

Nathan Coe, the group’s chief executive, said: ‘This has been another strong year of financial, operational and strategic progress for Auto Trader. 

‘We are confident in our prospects for the year ahead and, in the longer term, we see significant opportunities to continue growth our marketplace and to move more of the car buying process online.’

Keith Bowman, an equity analyst at Interactive Investor, said: ‘The shares are not cheap after outperforming the FTSE 100 index over the last year, but while they may appear to be “up with events”, Auto Trader looks to remain a core holding in the sector, with consensus City opinion pointing towards a strong hold.’