Universal Salvage, the vehicle salvage and services group, has raised pre-tax profits by 18% to £6.6m for the year ended April 28, on turnover down slightly from £87.6m to £84.2m.

Chairman Alexander Foster put the results down to improving operating efficiency. Turnover dropped due to pressure on residual values and a reduced number of vehicles handled, he said.

“The marketplace in which we operate is undergoing significant change and the European Union End of Life legislation is a catalyst for further transformation,” said Mr Foster. “We welcome the new legislation and believe it will substantially expand our growth opportunities.”

Universal Salvage set up a vehicle processing unit last year in preparation for the End of Life Vehicle (ELV) legislation. From January all ELVs will be classed as hazardous waste requiring them to be de-polluted at an approved treatment centre.

Carmakers will, from April, be required to handle all future vehicles they manufacture and from April 2007, they must have networks in place to handle every vehicle they have ever produced.