Durban - Combined Motor Holdings (CMH) continued its sound growth record to drive up a 33 percent increase in attributable income to R39,4 million for the year to February 28, the company said yesterday.
Jebb McIntosh, the managing director, said the retail motor dealership, car hire and financial services company benefited from the 15 percent increase in the car and light commercial vehicle market and an almost 25 percent rise in the luxury car market to achieve a 33 percent increase in earnings a share to 193,4c.
Analysts said the results followed the trend set by other motor dealerships as a result of consumers taking advantage of lower and more stable interest rates to replace vehicles.
Good results from the financial services division and better supply distribution of Volvos after Ford's purchase of the luxury car manufacturer last year also contributed to CMH's 20 percent climb in headline earnings a share to 193,4c off a 37 percent increase in turnover to R2,05 billion.
McIntosh said operating income before finance costs increased 35 percent to R61,6 million, giving shareholders the best return on their investment in the industry.
The car hire division still had not broken even, but McIntosh expected this to change during the current financial year.
The purchase of about R50 million worth of car hire vehicles increased the company's asset base by 35 percent and pushed up interest bearing debt to R12 million from R9,6 million.
Bonerts, the specialist accident damaged vehicle business that was acquired with effect from March 1 last year, was performing "exceptionally well", McIntosh said.
He said branches would be rolled out in Cape Town and KwaZulu Natal during the financial year, pushing up its contribution to group turnover and earnings to 10 percent.
CMH was also "delighted" with its recently announced BMW and Land Rover Pretoria dealership acquisitions, which were expected to contribute R200 million to turnover this year. A Land Rover dealership would be launched in Umhlanga Rocks on July 1.
A financial services joint venture would also be finalised within the next few months.
CMH proposed a final dividend of 47c, raising the total for the year to 57,6c.
The company's stock closed unchanged at R10 yesterday.