Auto Trader posts sterling profit in first year of listing

Online vehicle sales firm Auto Trader posted a 27% rise in operating profits to £169.6m ($246.6m, €216.8) on Thursday (9 June), in its first full year as a listed company.

Headline revenue rose 10% to £281.6m, while earnings grew 12.67p per share, up from 0.85p per share. In light of its performance, Auto Trader has proposed a final dividend of 1p per share, totalling 1.5p per share for the year, in tandem with a rolling programme of share buy-backs.

The majority of the surplus cash after dividends would be returned to shareholders, the firm added.

Chief executive Trevor Mather said: "We are delighted with the progress that the group has made in its first full year as a public company.

"The new financial year has started well, and the board is confident of delivering continuous improvement in both our consumer and retailer solutions, as well as our overall performance in the coming year."

The results were broadly welcomed by City analysts. George Salmon, equity analyst at Hargreaves Lansdown, said Auto Trader has its target market "sewn up" and continues to benefit from a buoyant market in car sales, both new and used.

"Debt has fallen rapidly, reflecting the company's strong cash flows and low capital requirements, and indeed cash is now due to be returned to shareholders via a share buy-back scheme. The shares aren't cheap, but the business model is strong and the company remains well placed to benefit from the ongoing shift to digital advertising," he added.