Peter Vardy reports £11m loss as group undergoes strategic restructuring

AM100 motor retailer Peter Vardy Group has reported a significant financial loss of £10.93 million in its latest set of financial results, marking a sharp contrast to the previous year's pre-tax profit of £4.8m.

The group’s turnover for the year ending December 2023 fell 6.6% from £590.5 million to £551.3 million, due to a series of strategic changes including divesting from its used car supermarkets and focusing on luxury brands.

Turnover will fall further in its next annual accounts as Peter Vardy sold off much of its franchised dealership business to Park's Motor Group in December 2024.

The decision to close the Peter Vardy Carz used car supermarket sites, a move driven by a shrinking supply of sub-five-year-old used cars due to production stoppages during the pandemic, had a significant financial impact with the closure, alongside one-off costs, amounting to £15m, the 2023 accounts show.

Despite these setbacks, CEO Peter Vardy emphasised that the restructuring was necessary for long-term growth, positioning the group for a more sustainable future.

“The strategic decisions made this year-though not without cost-have allowed us to realign the group's focus on high-growth opportunities, both in the luxury automotive sector and through our innovative new ventures.

“In the motor division, we are now focused on building stronger, more profitable relationships with our luxury brand partners while maintaining the operational flexibility to scale our newer ventures FlexAuto and CarMoney.”

Alongside the closure of the used car supermarkets, the group integrated its CarMoney finance business into Peter Vardy Holdings, aiming to enhance operational efficiency and agility.

CarMoney, which was hailed as a “standout performer” for the group, brokered a record £208m during the year and banked a trading profit of £3.6m.

In an effort to expand this further, the company piloted a start-up operation in Australia, where it said results had been promising. The group now plans to scale internationally, with plans to launch in 10 international markets within five years. Domestically, it also introduced a UK franchise model for CarMoney, targeting financial services talent, and signed its first franchisee with a target of representing 30 territories in the coming years.

Peter Vardy Group's investment in FlexAuto, its flexible leasing business, also saw growth, with a fleet of 1,000 vehicles servicing around 75 SME businesses.

“This represents the first step in our plan to create a scalable business, which we expect will continue to require significant investment in FY 2024 as we prepare for exponential growth over the next five years. We also see strong potential for overseas franchising in this business,” said Vardy.

In addition to the restructuring in the motor division, the group made significant changes to its dealer network. It sold several sites to Parks Automotive Group and Arnold Clark in 2024, reducing its portfolio to focus primarily on its two Porsche Centresin a bid to exit volume brand business.

Despite these challenges, the group’s balance sheet remains strong, with net assets increasing to £100.3m. The group also provided a one-time cost-of-living bonus to staff, totaling £960,000, as part of its efforts to support employees during difficult times. The average workforce size decreased from 1,008 to 841, with wages and salaries dropping to £34.07m.

Looking ahead, Peter Vardy said “Our investments in technology and international expansion ensure that the Peter Vardy Group remains at the forefront of industry disruption. We entered FY2024 with a strong balance sheet, a clear strategic direction, and the confidence that our decisions today will drive the group's success for years to come.”