HR Owen Group is upbeat about its financial performance in the remainder of the financial year, despite profits taking a substantial hit as a result of the failure of its insurance company, Independent Insurance.

Turnover for the first half of the year increased to £281m compared to £260m for the first half of 2000. However, profit before tax was £1.73m (2000: £2.03m). The fall was out down to a loss of £609,000 resulting from Independent Insurance going into liquidation. Profit after tax was £1.05m (2000: £1.38m).

Chairman John MacArthur said: “We will continue to balance our franchised portfolio by securing a number of large market territories. We are confident our strategy of focusing on core manufacturer relationships, combined with intrinsic value of our unique portfolio of brands, will provide a strong platform for continued growth.”

He is also confident that the company will prove strong enough to ride the potential economic storm resulting from the terrorist attacks in the US.

“Any adverse effects which reduce corporate or retail spending could affect the results for the remainder of the year. However, during previous periods of economic uncertainty the group's quality franchises and the essential positioning of our dealerships has proved a hedge vis-à-vis our competitors,” said Mr MacArthur.

HR Owen has been offered one of Mercedes-Benz's 27 new retail territories to be granted to third parties. On October 1 the group will open a new Mercedes showroom in Crawley, the “first of a new generation of outlets”.

The group has also been appointed as the first dealer in the world to sign for the new Rolls-Royce franchise. This will operated in London from January 2003, when BMW takes over the marque.