Inchcape upgrades 2021 profits forecast to ‘at least £290m’

Inchcape has upgraded its group profit-before tax forecast for 2021 to “at least £290 million” driven by a stronger margin performance across the business.

The group’s global Q3 revenues increased year-on-year by 10% to £1.9 billion on an organic basis (2% below Q3 2019).

Duncan Tait, Inchcape group chief executive, said performance in the UK and Europe specifically had been “relatively resilient” against a backdrop of supply constraints that are not expected to improve until “well into 2022”.

Tait said: “The group's Q3 results were stronger than expected.

“The better performance was broad based, with all regions supporting the results in the quarter.

“The pandemic continues to cause uncertainty across the globe, although with largely localised restrictions, it had a relatively small impact on the group in the period.

“While the ongoing supply shortages have had some impact on our topline performance, the Group has, to date, benefited from higher vehicle gross margins.”

Tait said the company is making progress with leveraging data and its digital capabilities and will be sharing its wider strategy and future growth prospects at its Capital Markets Day on November 17.

He added: “While the widely reported supply issues are not expected to improve until well into 2022, we are confident margins will remain robust through this period, mitigating the likely impact on our topline.

“The long-term growth prospects of the group are attractive and exciting.

“Our ambition is to become the undisputed distributor of choice for OEMs. We will achieve this by further strengthening our OEM relationships and with more emphasis on capturing the lifetime value of both customers and vehicles."