‘Positive momentum’ continues for used car seller Motorpoint as it looks to put ‘difficult’ 2023 in rear view mirror

Used car seller Motorpoint said it expects to perform at the “favourable end” of management expectations after the strong momentum seen at the turn of the year continued.

In a trading update covering the three months to March, the firm said it had seen a “strong and profitable” performance in the fourth quarter.

“The positive momentum experienced at the start of the calendar year continued,” the firm added.

Retail volumes were up around nine per cent year-on-year and it had seen “continued margin recovery”. Margins improved as the firm sold through stock affected by the abrupt fall in used car values during the third quarter.

Motorpoint said that its strong digital presence had helped generate consumer demand from “strong website traffic”.

This meant January, February and March were all profitable months for the company.

“Loss before tax for the full year therefore anticipated to be at the favourable end of management expectations,” the firm said.

Costs remain “tightly controlled” after last year’s “rightsizing programme” and efficiencies from technology investment.

The firm said its balance sheet remains robust with no structural debt and around £9m of cash.

“I am delighted that the difficult conditions experienced in 2023 have eased in Q4 and, combined with our focus on driving operational excellence through a programme we call Brilliant Basics, has meant that Q4 was characterised by consistent profitability,” Mark Carpenter, chief executive officer of Motorpoint Group said.

“We are achieving growth, increasing stock turn and improving margins, and this is expected to continue into FY25 as supply improves following recent new car registration growth,” he continued.

“I am therefore optimistic for FY25 and look forward to Motorpoint making the most of the growth opportunities ahead,” he concluded.

Motorpoint shares in the year-to-date are up over 21 per cent.