21 May 2013 – results, acquisition and placing
The group has announced its final results for the year to 28 February and these have revealed a 15.7% increase in turnover to £1.26bn whilst adjusted pre-tax profits came in at £8.2m, an increase of 12.3% over the previous year. Earnings per share on the same basis rose to 3.22p from 3.19p and the dividend for the year was raised 16.7% to 0.7p. Net debt at the year end was £6.2m compared with net cash of £3.5m a year earlier and the group opened or acquired 20 new outlets during the year, taking the total number of outlets to 96.
The group has also announced that it is to acquire Albert Farnell, the West Yorkshire-based motor dealership group which operates 3 Land Rover franchises. The consideration for the acquisition is £31.0m in cash and to help fund the purchase Vertu is raising approximately £50m before expenses through a placing of shares at 38p. The group expects the acquisition to be earnings enhancing in its first full year of ownership and the purchase of Farnell is in line with the group’s strategy of expanding through acquisition. We maintain our recommendation of BUY.