REG - Motorpoint Group plc - Interim Results Strategy Update and People Changes
25/11/2021 07:00
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RNS Number : 5274T Motorpoint Group plc 25 November 2021
25 November 2021
Motorpoint Group PLC
("Motorpoint" or the "Group")
Interim Results, Strategy Update and People Changes
Record breaking first half revenue and profit performance highlighting
excellent progress made on strategic objectives.
Board confident of delivering full year revenue and profit before tax
significantly ahead of its expectations
Motorpoint Group PLC, the UK's leading independent omnichannel vehicle
retailer, today announces its unaudited interim results for the six months
ended 30 September 2021 ("H1 FY22").
Financial KPIs 6 months to 30 September 2021 6 months to 30 September 2020 Change
Revenue £605.2m £387.7m 56.1%
Gross profit £55.5m £35.4m 56.8%
EBITDA((1)) £18.3m £14.0m 30.7%
Operating profit £15.1m £11.1m 36.0%
Profit before tax £13.5m £9.7m 39.2%
Basic earnings per share (p) 11.8 8.8 34.1%
Number of sites (current) 15 13 +2
(1) Calculated as operating profit of £15.1m adding back
depreciation of £3.2m (H1 FY21: Operating profit of £11.1m adding back
depreciation of £2.9m).
H1 FY22 Financial highlights
· Revenue increased 56.1% to £605.2m (H1 FY21: £387.7m) reflecting
record performance after reopening, continued strong consumer demand for used
vehicles and strong market share gains
· Gross margin of 9.2% at record levels (H1 FY21: 9.1%) due to
vehicle value appreciation, strong buying and pricing controls, improved
finance penetration, as well as continued efficiency improvements to the
preparation processes, all despite the introduction of vehicles more than
three years old
· EBITDA((1)) improved 30.7% to £18.3m (H1 FY21: £14.0m)
· Profit before tax increased 39.2% to £13.5m (H1 FY21: £9.7m)
despite ongoing investment in technology, people and marketing to execute on
our strategy
· Basic earnings per share increased 34.1% to 11.8p (H1 FY21: 8.8p)
H1 FY22 Operational and Strategic highlights
· Retail volume growth of 46% in the period outperformed the overall
used SMMT car market which grew 31%
· Total online units were over 60% of overall volumes demonstrating
the growing strength of our E-commerce offering
· Online retail sales increased by 53% against the same period last
year reflecting continued progress in our transformation to a digitally led
business
· Quickly gained a 2.2% share of the three to four year-old market,
illustrating our agile business model and ability to adapt at pace to changing
market conditions
· Further lowered APR finance rates to 8.9% from 1 October 2021 as
we reinforce our position as the best-value car retailer in the UK. In the
period finance penetration improved significantly to 51.7% in September (H1
FY21: 42.1%)
· Significant investment in the period on people, technology
upgrades and marketing
· Website traffic improved by 24% compared to the same period a year
ago, with improvements across a full range of online marketing metrics, with
unsubscribe rates dropping to just 0.2%
· Data science now helping to influence buying patterns and targeted
marketing
· Further stock turn improvement of 25% with average 42 days in
stock for non-commercial retail vehicles (H1 FY21: 56 days)
· Manchester branch opened on 1 October. We now have agreements for
further branches in Maidstone, Milton Keynes and Portsmouth; with a number of
other strategic locations in the pipeline
· Motherwell preparation centre opened during August 2021, which
adds more than 20,000 units to retail capacity; retail preparation capacity
now in excess of 120,000 units per annum (on a single shift basis)
· Successful launch of the Motorpoint car buying service in July
2021 - already seeing clear benefits with 12.6% of retail vehicles sold in H1
being sourced from consumers (H1 FY21: 7.6%)
· H1 Net Promoter Score ('NPS') further improved to a record
breaking 84 (H2 FY21: 83)
· Increased our stocking facility with Lombard North Central PLC
from £26m to £45m on unchanged terms
Current Trading and Outlook
Despite the ongoing constriction in the supply of new vehicles, which is
expected to continue into 2022 and beyond, in recent weeks we have been able
to use our market position to access more stock to satisfy customer demand,
both online and in branch. This increased demand reinforces our belief that
our customer-centric, omnichannel proposition remains the most appropriate
business model for the used car market.
Revenue and profit in October continued to be well ahead of the same periods
in FY21 and FY20. As a result, the Board is confident of delivering revenue
ahead of plan for the full year, and therefore full year profit before tax
significantly ahead of its expectations.
The Group is well placed to deal with any uncertainty or potential headwinds
and continues to invest further in growth. The Board looks to the future with
confidence, as the Group transitions to a digitally led business with huge
potential.
People Changes
After 11 years with the Group, Mark Morris has decided to retire as
Non-Executive Chairman, and will leave the business in January 2022. Mark
has played an extremely instrumental role in helping the business grow to
become the UK's leading independent omnichannel vehicle retailer, not least
successfully guiding Motorpoint through its IPO in 2016.
John Walden will join the Group as our new Chairman on 10 January 2022.
John is currently Chairman of Snowfox Topco Ltd, the ultimate parent company
of the Yo! group and the Snowfox group and has had prior roles including
Chairman of Naked Wines plc, Chairman of the parent company of Holland &
Barrett International Ltd., Chief Executive of Argos and its parent company
Home Retail Group plc, and several senior roles with Best Buy Co. including
Executive VP and President of the Internet Division. John has been a driving
force in omnichannel and consumer driven retailing, as well as leading digital
and transformational change, both in the UK and US. John will be a great
addition to the team as the Group continues its transition to a digitally led
business.
In early 2022 Andrew Thomson will also join us as Chief Digital Officer. He
has been Group E-commerce Director at Boohoo Group PLC, and before that he had
a number of senior positions within the Pentland Group, most notably Group
Digital Director. Andrew will be another key player in our digital
transformation journey.
Mark Carpenter, Chief Executive Officer of Motorpoint Group PLC commented:
"The first half of the year marked a record performance for the Group. While
we have naturally benefited from favourable market conditions, we have also
had to contend with unprecedented vehicle inflation and widely documented
shortages in available stock which undoubtedly limited our revenue and profit
growth. In the end, it is our market share gains which demonstrate the unique
strengths of our model.
"During the period we continued to invest in future growth with strong
progress made on our medium term strategic targets as we execute on our goal
of at least doubling revenue to over £2bn in the medium term.
"On behalf of the Board, I would like to thank our Motorpoint team who have
been exemplary in their commitment to the business throughout these uncertain
times. Our team continue to inspire me and I am grateful for their passion,
energy and enthusiasm for our brand.
"Finally, I must extend my personal thanks to Mark Morris, who I have worked
closely with for a number of years. Mark has always been there to offer
advice and has been a big support to me. Whilst I will greatly miss his
input, as will my colleagues, I look forward to welcoming John and his digital
experience to the business."
Analyst conference call
There will be a conference call for sell-side analysts at 09:30am GMT today,
the details of which can be obtained from FTI Consulting via
motorpoint@fticonsulting.com.
Enquiries:
Motorpoint Group PLC via FTI Consulting
Mark Carpenter, Chief Executive Officer
Chris Morgan, Chief Financial Officer
FTI Consulting (Financial PR) 020 3727 1000
Alex Beagley
Sam Macpherson
Amy Goldup
Inside information: This announcement contains inside information as defined
in Article 7 of the retained EU law version of the Market Abuse Regulation No
596/2014 ("UK MAR") and has been announced in accordance with the Company's
obligations under Article 17 of UK MAR.
Forward looking statements: The information in this release is based on
management information. This report includes statements that are forward
looking in nature. Forward looking statements involve known and unknown risks,
assumptions, uncertainties and other factors which may cause the actual
results, performance or achievements of the Group to be materially different
from any future results, performance or achievements expressed or implied by
such forward looking statements. Except as required by the Listing Rules and
applicable law, the Company undertakes no obligation to update, revise or
change any forward looking statements to reflect events or developments
occurring after the date of this report.
Notes to editors
Motorpoint is the UK's leading independent E-commerce led omnichannel vehicle
retailer, focused on giving retail and trade customers the easiest, most
affordable and seamless way of buying, selling and financing their car whether
online, in-store or a combination of both. Through its leading B2C platform
Motorpoint.co.uk and UK network of 15 sales and collection branches, the Group
provides an unrivalled offering in the nearly new car market, where consumers
can effortlessly browse, buy or finance their next car and collect or have it
delivered directly to their homes. Motorpoint's purely online wholesale
platform Auction4Cars.com sells vehicles into the wholesale B2B market that
have been part exchanged by retail customers, or purchased directly from them
by the Group as part of its online car buying service. Motorpoint's
diversified business model, underpinned by its established brand, industry
leading technology and sophisticated marketing infrastructure, always delivers
the best value, choice, quality and service for customers. The Group is proud
to have been recognised for seven consecutive years as one of the Sunday
Times' Top 100 Best Companies to Work For.
CHIEF EXECUTIVE'S STATEMENT
Overview
Since fully re-opening in April our omnichannel proposition has excelled,
providing customers with our renowned choice, value, service and quality.
With the majority of customers choosing to buy in person at one of our
branches we continue to offer all methods of buying a vehicle to ensure
everyone can access our value proposition.
I am especially pleased with our results in the first half. We have had to
contend with unprecedented vehicle inflation and widely documented shortages
in available stock. These shortages undoubtedly limited our revenue and
profit growth, yet we still managed to deliver strong profit before tax growth
of 39.2%, and record gross profit of £55.5m (H1 FY21: £35.4m).
We enjoyed record sales in the months post lockdown, and whilst revenue
moderated from June due to the reduced supply of vehicles, gross margins
remained strong. In addition to market appreciation, finance penetration
increased further following investment into our customer proposition and we
generated efficiencies in buying and preparation costs, despite the move into
greater than three year-old vehicles. As planned, strategic costs increased
in the period as we continue to invest in future growth with significant
technology and marketing investment. In particular, we invested heavily in
our infrastructure, technology and talent, as we continue our digital
transformation journey.
Strong progress has been made on our medium term strategic targets. We
launched our car buying service in July, and this has already become an
important enabler to increase the supply of retail vehicles and the volume of
transactions through Auction4Cars.com. We opened our 15th branch in
Manchester on 1 October, and our new Scottish preparation centre in Motherwell
in August. In addition to securing new locations in Maidstone, Milton Keynes
and Portsmouth, we have a strong pipeline of further sales and collection
centre opportunities.
Our operating model begins with our team
The last twenty months or so has been unprecedented, and our team have been
exemplary in their commitment to the business throughout these difficult
times. Our team continue to inspire me and I am grateful for their passion,
energy and enthusiasm for our brand.
Our operating model of how our key stakeholders interact is well understood by
our team and is covered in detail, mostly by me, with every new starter when
they attend our induction programme. The Motorpoint Virtuous Circle combined
with our Values of Proud, Happy, Honest and Supportive continue to provide a
robust framework for explaining how we get things done and what factors to
consider when decisions are required. Our team also have an opportunity to ask
open questions and understand key decisions in their interaction with our
Senior Leadership Team, who host Team Forums at each branch, or virtually,
every month. Many of the improvement areas in the business are found in these
sessions and our team often has a creative solution to issues we are facing
whether they be people, customer or operational challenges. We also ensure
each member of our team have a one on one meeting with their Manager each
month, to ensure pastoral and performance conversations happen regularly,
which contributes to our low attrition.
The learning and development of our people is vital to the future success of
our business. Our new Learning and Development platform launched last year to
the entire Company allows individual learning journeys to be created, logged
and reviewed.
We believe that the happiness of our team is directly correlated to our
customer satisfaction and engagement can be enhanced by giving something back
to the team. Our 'One Big Dream' initiative has been a huge success with our
people using two paid hours per month for their own fulfilment.
We continue to have fantastic examples of our team using this time to follow
their dreams, whether it be to attend a class or watch their child in a school
production. Since 2017 we have committed to being a Real Living Wage employer
and we expect to launch our sixth SAYE scheme, again offering the opportunity
to become a Motorpoint shareholder to our entire team, in the second half of
this year. Finally, none of our team have worked on their birthday since 2015,
something we believe is a unique team benefit in the UK.
Our annual participation in the 'bHeard Best Companies to Work For' provides
an opportunity for our team to provide honest, valuable feedback on their
engagement levels and how we can improve these further. I am proud that we
again achieved Top 100 status in the Sunday Times Top 100 companies to work
for earlier this calendar year. This is the seventh consecutive year that we
have been placed in the Top 100 and is testament to the hard work of our
management team in listening and acting on our people's feedback. We were also
Number One in the Automotive category.
We have a responsibility to improve diversity and inclusion in our industry.
We appointed a Head of Recruitment and Inclusion in December 2020 and have
continued to advance our plans in the first half of this year.
The Group has made good progress in the period on our ESG priorities. We
have recruited a Sustainability Manager, who will help guide Motorpoint in
this vitally important area, including as the lead of our newly established
ESG Committee. We have partnered with a third party to ensure we measure and
maximise our emission reductions, and our ESG strategy is being defined
through stakeholder engagement and an independent materiality assessment.
Motorpoint has always been conscious of its sustainability footprint and has
recycled vehicle parts such as tyres, batteries and brake discs for many years
wherever possible.
Customers
Our highly engaged team continued to deliver our market leading proposition of
Choice, Value, Service and Quality to our loyal customers during the period.
We have an unerring focus on customer satisfaction and that leads to an
increasing number of customers (over 34%) who repeat purchase from us (FY21:
33%). We take it personally when a customer is not happy, as we have failed if
this happens, and immediately look to remedy any dissatisfaction. We want
our customers to be delighted.
This level of customer loyalty is recognition of our strategy of delivering
unrivalled Choice, Value, Service and Quality:
Choice - our unique independent model allows us to source and sell from the
broadest range of suppliers, allowing us to flex our offering to achieve the
greatest value for our customers. In the period we have stocked well over 300
models from 38 manufacturers, and we are able to rapidly follow emerging
customer preferences, such as through our increasing proportion of hybrid and
electric sales. Our range increased in the period with a greater proportion of
prestigious vehicles, as well moving into the greater than three year-old car
market, where we quickly gained market share.
Value - we are an omnichannel vehicle retailer, predicated on working to a
high volume and keeping our cost base low. This allows us to share value with
our customers, reinforcing our volume model. We offer all our customers
finance and ancillary product offerings, where we also champion low prices,
illustrated by our decision to again reduce our finance APR rates, from 9.9%
to 8.9% on 1 October 2021. For higher value vehicles we reduced our APR to
7.9%. Our Value proposition continues to appeal during these uncertain
times.
Service - service is what will ultimately set us apart in the market. We
measure ourselves primarily using Net Promoter Score ('NPS') - on this measure
we have improved again, with a record score of 84 (H2 FY21: 83).
We are delighted with this level of customer satisfaction, but are always
striving for more, and constantly challenge our processes to make the buying
experience as smooth as possible.
Motorpoint serves all buyers, whatever their location, and whether they wish
to buy online, in-person at our branches, or through a fluid combination of
both channels. Motorpoint has become one of a select number of businesses to
be included in the brand-new Platinum category in recognition for achieving
successive years of Feefo Gold Trusted Service status.
Quality - our strategic vision is to ensure that our omnichannel model
delivers the same exceptional experience in any channel with which the
customer choses to interact. Our ambition is to be the most trusted automotive
retailer, and this means quality across everything we do, with complete focus
on our customers' needs.
Our strategy to more than double revenue in the medium term remains on track
Through our omnichannel business model, our focus remains on the customer,
delivering unrivalled Choice, Value, Service and Quality. The Group's medium
term goals are fourfold:
· Rapidly upscaling E-commerce capability;
· Increasing customer acquisition and retention;
· Expanding wholesale and E-commerce channels; and
· Continual improvement in operational efficiency through
technology and innovation.
Online retail sales increased by 53% against the same period last year
reflecting continued progress in our transformation to a digitally led
business, and total online sales were over 60% of overall volumes (H1 FY21:
62% - inflated due to lockdown induced branch closures). We launched our
online car buying service in July 2021, and during H1 12.6% of retail vehicles
were sourced from consumers (H1 FY21: 7.6%).
As planned, we invested heavily in the period in talent capability, technology
upgrades and marketing. We have completed a third-party audit of our tech
stack, and a future road map has been developed. A significant number of new
technology roles have been recruited, with the focus on engineers and enabling
our migration to cloud. In addition, a new role of Chief Digital Officer
will commence in H2. We have made significant improvements to our website,
email communications and targeted digital marketing activity. Website traffic
improved by 24% compared to the same period a year ago, and improvements have
been made in all email metrics, with unsubscribe rates dropping to just 0.2%.
We have invested in data science tools and talent and this now supports
buying and pricing decisions and targeted customer communications; we are
excited by the opportunity this brings.
Our 15th branch opened in Manchester on 1 October, with agreements in place to
open in Maidstone, Milton Keynes and Portsmouth. A number of other locations
are being evaluated, and we remain on track to open a further 11 sales and
collection centres in the medium term. Motherwell preparation centre, our
second dedicated preparation site, opened in August, and has the capacity to
prepare 20,000 cars per annum; retail preparation capacity is now in excess of
120,000 units per annum (on a single shift basis).
We have also further invested in the Auction4Cars.com leadership team and with
it significant industry experience. We are also able to buy cars direct from
consumers, which are not part-exchange, and this is an important enabler to
increase the supply of retail vehicles and the volume of transactions through
Auction4Cars.com.
Motorpoint is an agile business with strong brand awareness, low fixed costs
and a compelling operating model that has always offered its customers the
best value proposition in the UK used car market. We have always sold cars
online, first through a call centre handling online enquiries and now through
a fully integrated, end-to-end digital customer journey. This digital-led
experience will continue to evolve in accordance with what our customers
demand. Fundamentally, we see this as providing a large choice of high-quality
vehicles at outstanding value, and with best in class levels of customer
service whether purchasing online, through our retail branches, or using a
fluid combination of these channels.
Mark Carpenter
Chief Executive Officer
25 November 2021
FINANCIAL REVIEW
Group financial performance headlines
Despite the well-documented challenges in our industry and the on-going
impacts of COVID-19, the Group experienced strong sales when branches reopened
to customers in April, reflecting the anticipated pent-up demand. We
experienced record sales in April and May, although sales growth moderated
from June due to the reduced supply of vehicles.
Revenue for the half year to 30 September 2021 increased by 56.1% to £605.2m
(H1 FY21: £387.7m), following strong consumer demand for used vehicles and
the Group's continued strong market share gains. FY21 comparatives were
impacted by COVID-19.
Gross profit was £55.5m (H1 FY21: £35.4m), an increase of 56.8%. Gross
margin was strong at 9.2% (H1 FY21: 9.1%). The performance reflected record
vehicle margins, strong buying and pricing controls, as well as continued
efficiency improvements to the preparation processes, despite the introduction
of greater than three year-old vehicles.
EBITDA increased by 30.7% to £18.3m (H1 FY21: £14.0m). Profit before tax
increased by 39.2% to £13.5m (H1 FY21: £9.7m). This was despite a planned
increase in strategic costs, as the business further invested in people,
technology and marketing.
Although there was significant vehicle inflation impacting stock valuations,
cash at 30 September 2021 remained flat with year end at £6.0m.
Trading performance
The Group has two key revenue streams, being (i) vehicles sold to retail
customers via the Group's branches, call centre and digital channels, and (ii)
vehicles sold to wholesale customers via the Group's Auction4Cars.com website.
Retail customers Wholesale
customers
Total
H1 FY22 H1 FY21 H1 FY22 H1 FY21 H1 FY22 H1 FY21
£m £m £m £m £m £m
Revenue 512.0 318.9 93.2 68.8 605.2 387.7
Gross profit 45.7 30.5 9.8 4.9 55.5 35.4
During the period, Motorpoint launched its car buying service, purchasing cars
direct from consumers. This is an important enabler to increase the supply
of retail vehicles and the volume of transactions through Auction4Cars.com.
During H1, 12.6% of retail vehicles sold were sourced from consumers (H1 FY21:
7.6%).
Retail
Revenue from retail customers was up 60.6% to £512.0m (H1 FY21: £318.9m),
with over 34,000 vehicles sold. Of these 38.6% were sold online, retaining our
position as the number one retailer of nearly new cars in the UK, both online
and offline. Volumes increased by 46.1% over H1 FY21. Due to the reduced
supply of vehicles in the market, we expanded our offering from our core
market of vehicles under three years old, to include greater than three years
old. We quickly gained a 2.2% share in this three to four year-old market,
again showing our ability to successfully adapt at pace to changing market
conditions.
Gross margin of 8.9% remained high in the period (H1 FY21: 9.6%) reflecting a
number of positive trends. Vehicle margin benefited from increased demand
pushing prices up and robust internal changes in buying and pricing
strategies. Retail margin in H1 FY21 was positively impacted by high demand
after the first lockdown. Although we experienced further preparation cost
efficiency, this was offset in part by the addition of vehicles in the more
than three year old range. We continue to push for further efficiencies in
this area.
Finance per vehicle sold improved significantly in the period, with an overall
penetration of 51.7% in September (H1 FY21: 42.1%). Our APR finance rates
were reduced further to 8.9% from 9.9% from 1 October as we reinforce our
position as the best-value car retailer in the UK.
The Group also continued to focus on internal processes within the vehicle
handling and preparation side of the business. Improved speed of preparation,
combined with strong cost control, has resulted in efficiencies. This was
despite an increased cost of preparing vehicles in the greater than three
year-old range.
Our new Manchester branch opened on 1 October.
Wholesale
Wholesale revenue via Auction4Cars.com, which sells vehicles which have been
part-exchanged by retail customers, or directly purchased from consumers,
increased by 35.5%. Roughly 19,000 vehicles were sold via this purely online
platform. Gross margin strengthened to 10.5% (H1 FY21: 7.1%), reflecting
both the market and internal pricing controls.
Operating expenses
Operating expenses increased from £24.3m in H1 FY21 to £40.4m. COVID-19
net relief of approximately £1.5m explains part of this movement. Variable
costs were also cut wherever possible last year, due to the COVID lockdowns.
This year the Group made a planned uplift in strategic costs, as we further
invest in people, technology and marketing. Marketing costs included a greater
proportion of digital spend than previously, which is expected to continue.
Exceptional items
There have been no exceptional items in the period (H1 FY21: £Nil).
Interest
The Group's net financial expense was £1.6m (H1 FY21: £1.4m).
Total interest charges on the stocking facilities in the period were £0.7m
(H1 FY21: £0.6m).
Interest on lease liabilities of £0.9m (H1 FY21: £0.8m) was incurred during
the period.
Taxation
The Group seeks to manage its taxation obligations in the UK in compliance
with applicable tax laws and regulations, ensuring that available tax
incentives and allowances are utilised, and recognised where it makes
commercial sense to do so giving regard to the costs of making the associated
claims.
The tax charge in the period is for the amount assessable for UK corporation
tax in the year net of prior year adjustments and deferred tax credits. The
effective rate of tax in the year of 21.5% (H1 FY21: 18.6%) is higher than the
charge which would result from the standard rate of corporation tax in the UK
of 19.0%. This reflects timing differences relating to fixed assets.
Shares
At 30 September 2021, 90,190,000 ordinary shares were outstanding, of which
556,980 were held in the Employee Benefits Trust.
Earnings per share
Basic and diluted earnings per share were 11.8p (H1 FY21: 8.8p) and 11.7p (H1
FY21: 8.7p) respectively.
Dividends
No dividend was paid in the period (H1 FY21: £Nil) and the Board has not
recommended an interim dividend (H1 FY21: £Nil) while it focuses on driving
significant growth.
Capital expenditure and disposals
Cash capital expenditure was £3.4m (H1 FY21: £0.3m), and primarily related
to the new Manchester branch, which opened on 1 October 2021, the dedicated
preparation centre in Motherwell, which opened in August 2021, and various
branch refits.
The Group is also investing in projects to strengthen its digital offering and
online presence; this strategy will continue.
There was minimal spend in H1 FY21 due to the uncertainty caused by COVID-19.
Balance sheet
The Group continues to have a strong balance sheet, with net current assets
increasing since year end by £6.7m to £22.3m. Working capital was
proactively managed during the period.
Non-current assets were £67.4m (FY21: £60.9m) made up of £18.6m of
property, plant and equipment, £47.6m right-of-use assets and £1.2m of
deferred tax assets (FY21: £16.1m, £43.6m and £1.2m respectively). The
Group currently owns three properties being the preparation centre in
Peterborough, the Stockton on Tees branch, and some additional land in
Glasgow. All other properties are on leases of various lengths.
The Group closed the period with £154.9m of inventory, up from £128.4m at
FY21 year end. Whilst stock would have been inflated at the end of March due
to a build up for the post lockdown re-opening, used vehicle values increased
considerably in the period, with inflation of approximately 29% since the year
end.
At 30 September 2021 the Group had £106.0m (FY21: £106.0m) of stocking
finance facilities available of which £104.0m (FY21: £89.2m) was drawn.
This increase reflected the sharp inflation in used car prices. The Group
currently has stocking facilities with Black Horse Limited of £80.0m, and
£45.0m with Lombard North Central PLC. The Lombard facility was increased
from £26.0m after the period end, on the same terms as the previous
arrangement.
The Group also has a £20.0m facility with Santander UK PLC, split between
£6.0m available as an overdraft and £14.0m available as a revolving credit
facility. At 30 September £Nil was drawn on this facility.
Trade and other receivables have increased to £9.2m (FY21: £7.7m) due to
increased levels of trade in the run up to period end.
Trade and other payables, inclusive of the stock financing facilities, have
also increased to £145.9m (FY21: £125.7m) reflecting an increase in trade
creditors for inventory purchasing outside the stocking facilities and an
increase in operating expenses as the Group invests in its growth strategy.
The increase in total lease liabilities to £53.5m (FY21: £49.3m) reflects
the addition of Motherwell.
Cash flow
Cash generated from operations was £10.9m (H1 FY21: £17.7m). This movement
is primarily driven by the sharp increase in inflation, impacting inventory.
The Group's position net of cash and cash equivalents remained in line with
year end at £6.0m.
Closing monthly net cash balances remained positive throughout the year.
Capital structure and treasury
The Group's long term funding is provided primarily through shareholders'
funds and IFRS 16 related property debt, with bank debt available should it be
required.
The Group's loan facility with Santander UK PLC, split between £6.0m
available as an overdraft and £14.0m available as a revolving credit
facility, is used primarily as a mechanism for funding short term working
capital needs. The facility expires in May 2024.
Chris Morgan
Chief Financial Officer
25 November 2021
RESPONSIBILITY STATEMENT OF THE DIRECTORS IN RESPECT OF THE FY21 UNAUDITED
INTERIM RESULTS
The Directors confirm that these condensed consolidated interim financial
statements have been prepared in accordance with International Accounting
Standard 34, 'Interim Financial Reporting', as adopted by the European Union
and that the interim management report includes a fair review of the
information required by DTR 4.2.7 and DTR 4.2.8, namely:
· an indication of important events that have occurred during the
first six months and their impact on the condensed consolidated interim
financial statements, and a description of the principal risks and
uncertainties for the remaining six months of the financial year; and
· material related-party transactions in the first six months and
any material changes in the related-party transactions described in the last
annual report.
A list of current Directors and their biographies is maintained on the
Motorpoint Group PLC website www.motorpointplc.com
(http://www.motorpointplc.com)
By order of the Board
Mark
Carpenter
Chief Executive Officer
25 November 2021
Condensed Consolidated Income Statement
For the six months ended 30 September 2021
Unaudited Six Months ended 30 September 2021 Unaudited Six Months ended 30 September 2020 Year ended 31 March 2021
Note £m £m £m
Revenue 5 605.2 387.7 721.4
Cost of sales (549.7) (352.3) (658.9)
Gross profit 55.5 35.4 62.5
Operating expenses (40.4) (24.3) (49.9)
Operating profit 15.1 11.1 12.6
Finance costs 6 (1.6) (1.4) (2.9)
Profit before tax 13.5 9.7 9.7
Taxation 7 (2.9) (1.8) (2.1)
Profit and total comprehensive 10.6 7.9 7.6
income for the period/year
attributable to equity holders of
the parent
Earnings per share
Basic 9 11.8p 8.8p 8.4p
Diluted 9 11.7p 8.7p 8.4p
The Group's activities all derive from continuing operations.
The Group has no other comprehensive income. Total comprehensive income for
the period/year is equal to the profit for the financial period/year and is
all attributable to the shareholders of the Company.
Condensed Consolidated Balance Sheet
As at 30 September 2021
30 September 2021 (unaudited) 30 September 2020 (unaudited) 31 March 2021
Note £m £m £m
ASSETS
Non-current assets
Property, plant and equipment 10 18.6 18.3 16.1
Right-of-use assets 11 47.6 41.3 43.6
Deferred tax assets 1.2 1.3 1.2
Total non-current assets 67.4 60.9 60.9
Current assets
Inventories 154.9 102.5 128.4
Trade and other receivables 12 9.2 6.0 7.7
Current tax receivable 1.0 1.1 1.7
Cash and cash equivalents 6.0 13.6 6.0
Total current assets 171.1 123.2 143.8
TOTAL ASSETS 238.5 184.1 204.7
LIABILITIES
Current liabilities
Borrowings - - -
Lease liabilities 13 (2.9) (2.8) (2.4)
Trade and other payables 14 (145.9) (108.1) (125.7)
Contract liabilities - - -
Provisions 15 - - (0.1)
Current tax liabilities - - -
Total current liabilities (148.8) (110.9) (128.2)
NET CURRENT ASSETS 22.3 12.3 15.6
Non-current liabilities
Lease liabilities 13 (50.6) (43.1) (46.9)
Provisions 15 (2.3) (2.1) (2.0)
Contract liabilities - - -
Total non-current liabilities (52.9) (45.2) (48.9)
TOTAL LIABILITIES (201.7) (156.1) (177.1)
NET ASSETS 36.8 28.0 27.6
EQUITY
Share capital 0.9 0.9 0.9
Capital redemption reserve 0.1 0.1 0.1
Capital reorganisation reserve (0.8) (0.8) (0.8)
Employee Benefit Trust reserve (1.8) - (0.1)
Retained earnings 38.4 27.8 27.5
TOTAL EQUITY 36.8 28.0 27.6
Condensed Consolidated Statement of Changes in Equity
For the six months ended 30 September 2021
Six Months Ended 30 September Share capital Capital redemption reserve Re-organisation reserve EBT reserve Retained earnings Total equity
2021 (Unaudited)
£m £m £m £m £m £m
At 1 April 2021 0.9 0.1 (0.8) (0.1) 27.5 27.6
EBT Share Purchases and Commitments - - - (1.8) - (1.8)
Share based compensation options satisfied through the EBT - - - 0.1 - 0.1
Profit and total comprehensive income for the year - - - - 10.6 10.6
Share Based Payment - - - - 0.3 0.3
At 30 September 2021 0.9 0.1 (0.8) (1.8) 38.4 36.8
Six Months Ended 30 September Share capital Capital redemption reserve Re-organisation reserve EBT reserve Retained earnings Total equity
2020 (Unaudited)
£m £m £m £m £m £m
At 1 April 2020 0.9 0.1 (0.8) - 20.0 20.2
Profit and total comprehensive income for the year - - - - 7.9 7.9
Share Based Payment - - - (0.1) (0.1)
At 30 September 2020 0.9 0.1 (0.8) - 27.8 28.0
Year Ended 31 March 2021 Share capital Capital redemption reserve Re-organisation reserve EBT reserve Retained earnings Total equity
£m £m £m £m £m £m
At 1 April 2020 0.9 0.1 (0.8) - 20.0 20.2
EBT share purchases and commitments - - - (0.4) - (0.4)
Share based compensation options satisfied through the EBT - - - 0.3 (0.3) -
Profit and total comprehensive income for the year - - - 7.6 7.6
Share Based Payment - - - - 0.2 0.2
At 31 March 2021 0.9 0.1 (0.8) (0.1) 27.5 27.6
Condensed Consolidated Cash Flow Statement
For the six months ended 30 September 2021
Note Unaudited Six Months ended 30 September 2021 Unaudited Six Months ended 30 September
2020 Year ended 31 March 2021
£m £m £m
Cash flows from operating activities
Cash generated from operations 16 10.9 17.7 12.4
Interest paid (1.6) (1.4) (2.9)
Income tax paid (2.2) (2.0) (2.8)
Net cash generated from operating activities 7.1 14.3 6.7
Cash flows from investing activities
Purchases of property, plant and equipment (3.4) (0.3) (3.6)
Proceeds from disposal of property, plant and equipment and right-of-use - - 6.1
assets
Net cash used in investing activities (3.4) (0.3) 2.5
Cash flows from financing activities
Dividends 8 - - -
Payments to satisfy employee share plan obligations (1.8) - (0.4)
Repayment on leases (1.9) (1.2) (3.6)
Repayment of borrowings - (10.0) (10.0)
Net cash used in financing activities (3.7) (11.2) (14.0)
Net increase/(decrease) in cash and cash equivalents - 2.8 (4.8)
Cash and cash equivalents at the beginning of the period 6.0 10.8 10.8
Cash and cash equivalents at end of period/year 6.0 13.6 6.0
Net cash and cash equivalents comprises:
Cash at bank 6.0 13.6 6.0
The notes form an integral part of these Condensed Consolidated Interim
Financial Statements.
Basis of Preparation
Motorpoint Group Plc (the Company) is incorporated and domiciled in the United
Kingdom under the Companies Act 2006.
The Company is a public company limited by shares and is listed on the London
Stock Exchange; the address of the registered office is Champion House
(formerly Salisbury House), Stephensons Way, Derby, DE21 6LY. The Condensed
Consolidated Interim Financial Statements of the Company as at and for the six
months ended 30 September 2021 comprise the Company and its subsidiaries,
together referred to as the "Group". These financial statements are presented
in pounds sterling because that is the currency of the primary economic
environment in which the Group operates.
The Condensed Consolidated Interim Financial Statements for the six months
ended 30 September 2021 are unaudited and the auditors have not performed a
review in accordance with ISRE 2410, Review of Interim Financial Information
Performed by the Independent Auditor of the Entity.
Going concern
The Interim financial statements are prepared on a going concern basis. The
Group regularly reviews market and financial forecasts and has reviewed its
trading prospects in its key markets. As a result of Coronavirus the Group
operations were periodically closed due to lockdowns until 12 April 2021 in
England and Wales, and 26 April in Scotland. Despite the success of the home
delivery rollout, there was still a substantial amount of pent up demand which
helped accelerate recovery from the effects of the pandemic. As a result of
these encouraging results, the Group's strategic growth plan has commenced
with a new branch opening in Manchester, and a new preparation centre in
Motherwell.
The Board has reviewed the latest forecasts of the Group, and considered the
obligations of the financing arrangements. The Group's banking facilities
include a committed £20m facility provided by Santander UK PLC which was
undrawn as at the reporting date. As at 30 September 2021, the Group was
supported by stocking facilities provided by Lombard of £26.0m and Black
Horse Limited of £80.0m of which £104.0m was drawn in total. The Group has
successfully negotiated an extension to the Lombard facility to £45m from
October 2021 on the same terms to support its growth aspirations, as well as
funding the increased value of stock in the shorter term.
For the purpose of considering going concern the Group focuses on a period of
at least 12 months from the point of issuing the interim reports.
The Board has taken a reverse stress test approach in considering the going
concern status of the Group, reducing volumes to the point at which the Group
is either no longer compliant with banking covenants or depletes liquid
resources required to continue trading, whichever is earlier. Plausible
mitigating actions were built into the model including: reducing spend on
specific variable cost lines including marketing and branch trading expenses,
team costs most notably sales commissions, pausing new stock commitments, and
extending the period for which expansionary capital spend is suspended. It is
considered that all of these actions could conceivably be performed throughout
the going concern period.
The Board has also made use of the post year end trading performance to
provide additional insight into the continuing viability of the business. With
six months having passed since the year end, this evidence adds further
comfort to the continuing strength of the Group in an active market. Given the
continued historical liquidity of the Group and sufficiency of reserves and
cash in the stressed scenarios modelled, the Board has concluded that the
Group has adequate resources to continue in operational existence over the
going concern period. Accordingly, they continue to adopt the going concern
basis in preparing the interim financial statements.
New accounting standards, interpretations and amendments adopted by the Group
The accounting policies adopted in the preparation of the interim financial
statements are the same as those set out in the Group's annual financial
statements for the year ended 31 March 2021. The Group has not early adopted
any other standard, interpretation or amendment that has been issued but is
not effective.
1. Statement of Compliance
These Condensed Consolidated Interim Financial Statements have been prepared
in accordance with International Accounting Standard 34 Interim Financial
Reporting as adopted by the European Union and the Disclosure and Transparency
Rules sourcebook of the UK's Financial Conduct Authority. The financial
information included does not constitute statutory accounts within the meaning
of section 434 of the Companies Act 2006 ('the Act') and do not include all
the information required for full annual financial statements. Accordingly,
they should be read in conjunction with the Annual Report and Financial
Statements of Motorpoint Group PLC for the year ended 31 March 2021 which are
prepared in accordance with International Financial Reporting Standards as
adopted by the European Union. These condensed consolidated interim financial
statements were approved by the Board of Directors on 22 November 2021.
2. Significant Accounting Policies
The same accounting policies, presentation and methods of computation which
were followed in the preparation of the Annual Report and Financial Statements
for Motorpoint Group PLC for the period ended 31 March 2021 have been applied
to these Condensed Consolidated Interim Financial Statements where applicable.
The accounting policies and details of new standards adopted in the year ended
31 March 2021 are listed in the Motorpoint Group PLC Annual Report and
Financial Statements on pages 88-94.
4. Comparative Figures
The comparative figures for the financial year ended 31 March 2021 are
extracted from the Motorpoint Group PLC Annual Report and Financial Statements
for that financial year. The accounts have been reported on by the Company's
auditor and delivered to the Registrar of Companies. The report of the auditor
was (i) unqualified (ii) did not include a reference to any matters to which
the auditor drew attention by way of emphasis without qualifying their report
and (iii) did not contain a statement under section 498(2) or (3) of the Act.
The comparative figures for the six month period ended 30 September 2020 are
as reported in the prior year and were prepared in accordance with
International Accounting Standard 34 Interim Financial Reporting as adopted by
the European Union.
5. Segment Reporting and Revenue
Revenue represents amounts chargeable, net of value added tax, in respect of
the sale of goods and services to customers. Revenue is measured at the fair
value of the consideration receivable, when it can be reliably measured, and
the specified recognition criteria for the sales type has been met. The
transaction price is determined based on periodically reviewed prices and are
separately identified on the customer's invoice. There are no estimates of
variable consideration.
The transaction price for motor vehicles and motor related services is at fair
value as if each of those products are sold individually.
(i) Sales of motor vehicles
Revenue from sale of motor vehicles is recognised when the control has passed;
that is, when the vehicle has been collected by, or delivered to, the
customer. Payment of the transaction price is due immediately when the
customer purchases the vehicle. Sales of accessories, such as mats, are
recognised in the same way.
(ii) Sales of motor related services and commissions
Motor related services sales include commissions on finance introductions,
extended guarantees and vehicle asset protection as well as the sale of paint
protection products. Sales of paint protection products are recognised when
the control has passed; that is, the protection has been applied and the
product is supplied to the customer.
Vehicle extended guarantees where the Group is contractually responsible for
future claims are accounted for by deferring the guarantee income received
along with direct selling costs, and then releasing the income on a straight
line basis over the remaining life of the guarantee. Costs in relation to
servicing the extended guarantee income are expensed to the statement of
comprehensive income as incurred. The Group has not sold any of these policies
in the current or prior period but continues to release income in relation to
legacy sales.
Where the Group receives finance commission income, primarily arising when the
customer uses third-party finance to purchase the vehicle, the Group
recognises such income on an 'as earned' basis.
The assessment is based on whether the Group controls the specific goods and
services before transferring them to the end customer, rather than whether it
has exposure to significant risks and rewards associated with the sale of
goods or services.
Products and services Nature, timing of satisfaction of performance obligations and significant
payment terms
Sale of motor The Group sells nearly new vehicles to retail customers. Revenue is recognised
at the point the vehicle is collected by or delivered to the customer. The
vehicles satisfaction of the performance obligation occurs on delivery or collection of
the product.
The Group sells vehicles acquired through retail customer trade-ins to trade
customers through their website, Auction4Cars.com. Vehicles do not leave the
premises until they are paid for in full and therefore the revenue and the
profit are recognised at the point of sale. The satisfaction of the
performance obligation occurs on collection of the vehicle.
The Group operates a return policy which is consistent with the relevant
consumer protection regulations.
Sales of motor The Group receives commissions when it arranges finance, insurance packages,
extended warranty and paint protection for its customers, acting as agent on
related services behalf of a limited number of finance, insurance and other companies. For
finance and insurance packages, commission is earned and recognised as revenue
and commissions when the customer draws down the finance or commences the insurance policy
from the supplier which coincides with the delivery of the product or service.
Commissions receivable are paid typically in the month after the finance is
drawn down. For extended warranty and paint protection, the commission earned
by the Group as an agent is recognised as revenue at the point of sale on
behalf of the principal.
The Group offered an Extended Guarantee for either 12 or 24 months, which
commenced from the end of the manufacturer's warranty period. The revenue was
deferred until the start of the policy period, and then released on a
straight‑line basis over the policy term. Any directly attributable costs
from the sale (e.g. sales commission) were also deferred and released over the
same period. Customer claims are taken to the Income Statement as they are
incurred during the policy term.
Six Months ended 30 September 2021 Six Months ended 30 September 2020 Year
ended 31 March
2021
£m £m £m
Revenue from sale of motor vehicles 571.3 370.2 687.5
Revenue from motor related services and commissions 27.5 15.7 29.0
Revenue recognised that was included in deferred income at the beginning of 3.3 1.3 1.7
the period - Sale of motor vehicles
Revenue recognised that was included in deferred income at the beginning of 3.0 0.5 3.0
the period - Motor related services and commissions
Revenue recognised that was included in the contract liability balance at the 0.1 - 0.2
beginning of the period - Extended guarantee income
Total Revenue 605.2 387.7 721.4
6. Finance costs
Six Months ended 30 September Six Months ended 30 September Year ended
2021 2020 31 March
2021
£m £m £m
Interest on bank borrowings - - 0.2
Interest on stocking finance facilities 0.7 0.6 1.1
Other interest payable 0.9 0.8 1.6
Total finance costs 1.6 1.4 2.9
7. Taxation
The tax charge for the period is provided at the effective rate of 21.5% (FY21
H1: 18.6%) representing the best estimate of the average annual tax rate for
the full year profit.
8. Dividends
Six months ended 30 Six months Year
September ended 30 ended 31
2021 September March
2020 2021
£m £m £m
Final dividend for the year ended 31 March 2021 - - -
Interim dividend for the year ended 31 March 2022 - - -
Total dividends - - -
9. Earnings per Share
Basic and diluted earnings per share are calculated by dividing the earnings
attributable to equity shareholders by the weighted average number of ordinary
shares at the end of the period.
Six Months ended 30 September 2021 Six Months Year ended
ended 30 September 31 March 2021
2020
Profit Attributable to Ordinary Shareholders (£m) 10.6 7.9 7.6
Weighted average number of ordinary shares in Issue ('000) 90,190 90,190 90,190
Basic Earnings per share (pence) 11.8 8.8 8.4
Diluted Number of Shares in Issue ('000) 90,420 90,453 90,265
Diluted Earnings per share (pence) 11.7 8.7 8.4
The difference between the basic and diluted weighted average number of shares
represents the dilutive effect of the various Group share plans. This is shown
in the reconciliation below.
Six Months ended 30 September 2021 Six Months ended 30 September 2020 Year
ended 31 March 2021
Weighted average number of ordinary shares in Issue ('000) 90,190 90,190 90,190
Adjustment for share options ('000) 230 263 75
Weighted average number of ordinary shares for diluted earnings per share
('000)
90,420 90,453 90,265
10. Property, plant and equipment
WIP Land Short term leasehold improvement Plant and machinery Fixtures and fittings Office equipment Total
Freehold property
£m £m £m £m £m £m £m £m
At 1 April 2021
Cost 0.5 5.3 6.7 7.2 1.5 1.7 3.1 26.0
Accumulated depreciation 0.0 0.0 (4.8) (1.1) (1.0) (2.7) (9.9)
(0.3)
Net book value 0.5 5.3 6.4 2.4 0.4 0.7 0.4 16.1
Opening net book value 0.5 5.3 6.4 2.4 0.4 0.7 0.4 16.1
Additions 0.9 0.0 0.0 1.4 0.5 0.5 0.1 3.4
Depreciation 0.0 0.0 (0.2) (0.4) (0.1) (0.1) (0.1) (0.9)
Closing net book value 1.4 5.3 6.2 3.4 0.8 1.1 0.4 18.6
At 30 September 2021
Cost 1.4 5.3 6.7 8.6 2.0 2.2 3.2 29.4
Accumulated depreciation 0.0 0.0 (0.5) (5.2) (1.2) (1.1) (2.8) (10.8)
Net book value 1.4 5.3 6.2 3.4 0.8 1.1 0.4 18.6
11. Right-of-use assets
30 September 30 September 31 March
2021 2020 2021
Right-of-use assets £m £m £m
Balance brought forward 43.6 41.6 41.6
Additions 6.3 1.7 5.8
Depreciation charge (2.3) (2.0) (3.8)
47.6 41.3 43.6
12. Trade and other receivables
30 September 30 September 31 March
2021 2020 2021
Due within one year £m £m £m
Trade receivables 7.7 3.9 2.1
Other receivables - 0.5 0.5
VAT receivables - - 3.7
Prepayments 1.3 1.4 1.0
Accrued income 0.2 0.2 0.4
9.2 6.0 7.7
The Directors' assessment is that the fair value of trade and other
receivables is equal to the carrying value.
13. Lease liabilities
30 September 30 September 31 March
2021 2020 2021
Lease liabilities £m £m £m
Balance brought forward 49.3 45.4 45.4
Additions to lease liabilities 6.1 1.7 7.5
Repayment of lease liabilities (including interest element) (2.8) (2.0) (5.2)
Interest expense related to lease liabilities 0.9 0.8 1.6
53.5 45.9 49.3
Current 2.9 2.8 2.4
Non-current 50.6 43.1 46.9
53.5 45.9 49.3
14. Trade and other payables
Due less than 1 year
30 September 30 September 31 March
2021 2020 2021
£m £m £m
Trade payables
- Trade creditors 13.0 6.8 19.4
- Stocking finance facilities 104.0 80.5 89.2
Other taxes and social security
- VAT payable 3.0 3.2 -
- PAYE/NI payable 0.8 0.8 0.7
Accruals and deferred income 25.1 16.8 16.4
145.9 108.1 125.7
The Directors' assessment is that the fair value of trade and other payables
is equal to the carrying value.
15. Provisions
30 September 30 September 31 March
2021 2020 2021
£m £m £m
Make good provision(1) 2.2 1.9 1.9
Onerous leases(2) 0.1 0.2 0.2
2.3 2.1 2.1
Current - - 0.1
Non-current 2.3 2.1 2.0
2.3 2.1 2.1
(1) Make good provision
Motorpoint Limited is required to restore the leased premises of its retail
stores to their original condition at the end of the respective lease terms. A
provision has been recognised for the present value of the estimated
expenditure required to remove any leasehold improvements. These costs have
been capitalised as part of the cost of right-of-use assets and are amortised
over the shorter of the term of the lease and the useful life of the assets.
The timing of the cash outflow relating to the make good provision is in line
with the life of the relevant lease. The remaining term on existing leases
ranges from 1 to 16 years with a weighted average of 12 years.
There is judgement associated with the potential cost of remediation of each
property and estimated provisions have been based on the past experience of
the Group.
(2) Onerous leases
The Group operates across a number of locations and if there is clear
indication that a property will no longer be used for its intended operation,
a provision may be required based on an estimate of potential liabilities for
periods of lease where the property will not be used at the end of the
reporting period, to unwind over the remaining term of the lease. The onerous
lease is likely to be utilised for a period of five years.
16. Cash flow from operations
30 September 30 September 31
2021 2020 March
2021
Profit for the year attributable to equity shareholders 10.6 7.9 7.6
Adjustments for:
Taxation charge 2.9 1.8 2.1
Finance costs 1.6 1.4 2.9
Operating profit 15.1 11.1 12.6
Share Based Compensation Charge/(Credit) 0.3 (0.1) 0.2
Loss on disposal of property, plant and equipment - - 0.1
Depreciation charge 3.2 2.9 5.7
Cash flow from operations before movements in working capital 18.6 13.9 18.6
(Increase)/Decrease in inventory (26.5) 9.3 (16.6)
Increase in trade and other receivables (1.5) (1.6) (3.3)
Increase/(Decrease) in trade and other payables 20.2 (3.9) 13.7
Increase in trade and provisions 0.1 - -
Cash generated from operations 10.9 17.7 12.4
17. Share buybacks
Movements in the issued share capital during the period are shown in the table
below:
30 September 2021 30 September 2021 31 March 31 March
Shares '000
£m
2021 2021
Shares '000
£m
Shares in issue at start of period / year 90,190 0.9 90,190 0.9
Bought back and cancelled - - - -
Bought back and held as treasury shares - - - -
Released from treasury to satisfy employee share plan obligations - - - -
Shares in issue at end of period / year 90,190 0.9 90,190 0.9
The total cost of shares purchased for cancellation as shown in the Statement
of Changes in Equity was £nil (H1 FY21: £nil).
18. Risks and uncertainties
There are certain risk factors which could result in the actual results of the
Group differing materially from expected results. These factors include: the
ongoing impact of COVID-19, a negative implication to the Motorpoint brand and
customer perception, inability to maintain relationships with suppliers,
fluctuation on exchange rate having an impact on vehicle pricing, economic
conditions impacting trading including the impact of Brexit, market driven
fluctuations in vehicle values, supply chain disruption, a shortage of
available vehicles to purchase due to the well publicised computer chip
shortage, litigation and regulatory risk, failure of Group information and
systems, access to capital and financial resource, availability of credit and
vehicle financing and a failure to attract, retain and motivate high quality
staff.
Principal risks are consistent with those detailed in the Motorpoint Group PLC
Annual Report and Financial Statements. The Board continually reviews the risk
factors which could impact on the Group achieving its expected results and
confirm that the above principal factors will remain relevant for the final
six months of the Financial Year ended 31 March 2022.
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