June 29, 2022

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Lookers gives back £4m in furlough cash

2 min read

Record profits at Lookers have prompted the car dealer group to return £4 million of furlough support, although its reinstated dividend is almost equal to the amount of business rates relief that it received last year.

Lookers has made its best profits as a lack of new cars, because of global shortages of microchips, and pent-up demand from people wary of public transport have resulted in significantly higher car prices. Cost-cutting, including the closure of 27 showrooms and 1,500 redundanies during the pandemic, also has led to higher margins.

Lookers unveiled a pre-tax profit of £90 million for the year to the end of December compared with one of £1.5 million a year earlier and a £45 million loss the year before, when it admitted that it had overstated its profits for three years. Sales rose by 9 per cent to £4.05 billion last year from £3.69 billion in 2020.

Mark Raban, its chief executive, said: “It’s been a difficult couple of years for the company with Covid and with our own issues, but we are moving forward with pace.”

Lookers is one of the largest British car retailers, with 6,500 employees. Two years ago it was engulfed in an accounting crisis and it came under criminal investigation for fraud and regulatory inquiries into mis-selling.

Raban, 55, an industry veteran, joined the business as finance chief before being promoted to chief executive in February 2020, four months before a boardroom clearout. The company’s fortunes turned in late January after Constellation Automotive, the owner of webuyanycar.com, bought a stake of nearly 20 per cent, which sent its shares soaring amid takeover speculation.

The Lookers boss said he was “proud and delighted” to have returned £4.1 million of furlough support that the group had received in the first half of last year and justified not returning £9.8 million of business rates relief because it “wasn’t support we claimed for, it was just applied by councils. We were closed for the first…

Business Matters

2022-04-06 21:02:49

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