Full Year 2025 Vertu Motors PLC Earnings Call Transcript
Key Points
- Vertu Motors PLC (FRA:V2N) has a strong strategic position as one of the six supergroups in the UK with a wide geographic and manufacturer footprint.
- The company has a high-margin after-sales business, supported by a customer database of 2 million, which contributes significantly to profitability.
- A cost reduction program and a move to a single retail brand under the Vertu brand are expected to deliver GBP 5 million in medium-term savings.
- The company reported strong cash generation in the second half of the financial year, exceeding consensus net debt forecasts.
- Vertu Motors PLC (FRA:V2N) has implemented a significant share buyback program, justified by the share price being below tangible net asset value.
- Profits fell due to the zero emission vehicle mandate, which significantly disrupted the new car market.
- New vehicle gross profit generation dipped slightly due to a 22% fall in motability volumes.
- The company faced increased costs as a percentage of revenue, reflecting cost pressures and higher operating expenses from acquisitions and startups.
- Interest costs grew by GBP 1.6 million compared to last year, driven by increased manufacturer stocking charges and lease liabilities.
- The UK new retail market was the lowest in 25 years, leading to significant discounting of battery electric vehicles and impacting margins.
Good morning.
My name is Robert Forrester, chief executive of Virtue Motors PLC, and I'm joined by our CFO Karen Anderson, to go through the financial results for the year ended, February 2025.
The first slide shows our investment case, and it's worth a reminder that Virtue Motors PLC is the only major quoted player in the UK franchise retailer space. Our long-term investment case remains very sound and reflects our strong strategic position. We have scale. We are one of 6 supergroups in the UK with the widest geographic and manufacturer footprint in the United Kingdom. We have around 5% of the UK market. That scale gives us a very strong IT and marketing capability to deliver significant economies of scale.
The jewel in the crown of the business is our high margin after sales business built on a customer database of 2 million customers. We have high levels of customer experience, and we've developed very good long term retention strategies to power our profitability.
The culture of the
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