The managing director of Scotland's John Martin Group is upbeat about his company's annual performance, despite the Government "threatening sales" by increasing VAT to 20%.

Gordon Nisbet heads the Edinburgh-based dealer group and was responding to the publication of annual figures that show profits of £303,000 in 2009 following a deficit of £775,000 in 2008.

Turnover in 2009 was £146.89 million while 2008 delivered a turnover of £146.97 million.

Nisbet told AM: "I feel very positive about the future. We had a hard time two years ago but we've restructured, cut overheads, sold garages and made budget cuts.

"September is looking good for us and while the Government are certainly not helping the trade by increasing VAT and the second six months of the year could be tougher than the first six months, I still feel upbeat."

In July the John Martin Group sold its prominent Belmont site in Aberdeen to Peter Vardy where it had operated Vauxhall and Chevrolet franchises and is now developing a former car storage site at nearby Kemnay where Nisbet said the plan was to establish new dealerships.

"I'm not prepared to say who they may be at this time," he said, "but we are talking to some manufacturers and are currently working on the premises and showroom areas."