03/09/2008 - 22:00

Record profit for AHG

03/09/2008 - 22:00

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West Perth-based Automotive Holdings Group Ltd has reported a record underlying net profit for 2007-08 on the back of a 4 per cent increase in new vehicle sales.

West Perth-based Automotive Holdings Group Ltd has reported a record underlying net profit for 2007-08 on the back of a 4 per cent increase in new vehicle sales.

The automotive dealer reported an underlying net profit of $48.4 million for the year to June 30 2008 as a result of strong performances from the group's automotive retailing and logistics divisions and in the face of challenging market conditions.

In a WA Business News interview prior to the official release of the results, managing director Bronte Howson said despite the turbulence in the automotive industry, consumer resilience to higher costs of living had provided AHG with stable trading conditions.

He said the diversified automotive retailing and logistics group expected the market to liven up towards the end of the year.

"The market is tight at the moment, it's very much in line with the current climate in the economy and we expected it to be a little tight in the first quarter," Mr Howson said.

"In the third and fourth quarters of the calendar year we expect a stronger market.

"The big thing is I suppose is we can look at the sales in the industry last year and they were solid, but the new vehicle market is still very strong."

Last week, Toyota Motor Corp slashed its 2009 forecast due to slowing demand, putting off its goal of becoming the world's first auto maker to sell more than 10 million vehicles in a year.

Despite the foggy outlook within the industry, AHG appears to have gone from strength to strength since its acquisition of Allpike Citroen and Peugeot in May.

The acquisition gave the company its first Peugeot and Citroen dealerships in WA and grew the company's footprint in the key Osborne Park automotive retailing precinct.

The new dealerships take AHG's stable of dealerships in Australia and New Zealand to 104, representing 29 manufacturers.

Following a meeting on August 29, AHG's directors declared a final dividend of 10 cents, bringing the full year fully-franked payout to 17.25 cents - a rise of 38 per cent on the previous year.

The company's shares were trading at $2.06 on September 2, up from $1.85 on August 25.

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