Car Dealership owner Autosports Group.
extract from The Age...
When the IPO window re-opens after reporting season, one float candidate fund managers want to see again is car dealership owner Autosports Group.
Autosports owns 17 new car dealerships and two used car outlets and makes most of its revenue selling new and used Audis, Volkswagons and Mercedes Benz cars.
When the company presented to small cap fundies a few weeks ago, its pitch was very much about sales growth in luxury and prestige brands.
It said luxury and prestige sales represented 35 per cent of new vehicle sales in 2015 which was well up from only 14 per cent 20 years earlier, according to the investor presentation.
The question is how much further than number can rise in coming years.
And Autosports told potential investors that the margins on new and used prestige and luxury vehicles were also higher than sales of the likes of Toyota, Hyundai, Holden and Ford, while overheads as a percentage of profit were lower.
The differences are even greater when luxury cars, including Audi and Mercedes-Benz are compared to the likes of Toyota and Hyundai.
Fundies reckon Autosports may look for another acquisition or two before making a run at the ASX-boards later this year.
It told potential investors that the luxury and prestige cars market fragmented with Autosports Group accounting for only 3 per cent of the market.
Autosports sold 13,000 new cars in the 2016 financial year and 12,000 used cars. Revenue was pegged at more than $1 billion.
compared to APE ( who also hold 19% of AHE )
A.P. Eagers Limited (ASX: APE) is pleased to announce that it expects a record profit result for the half year to 30 June 2016.
A Net Profit Before Tax of approximately $67.8 million is expected for the first half of 2016, compared to $59.5 million for the corresponding period of 2015, an increase of 14%.
Final results for the half year are subject to completion of external audit review and will be released on 24 August 2016.
( courtesy of Bell Direct )
this is a 100 year old company .. one might question the new comers calculations
APE has acquired 2 dealership groups ( Tony Ireland and Crampton Automotive Group ) since June this year
Management’s ability to continually lift the performance of existing businesses over many years is complemented by their proven capacity to grow the company through diversification and acquisition.
At our last two annual general meetings, we have commented on our growth pattern, which has been “grow, consolidate, pause…., grow, consolidate, pause”. 2015 was a year of consolidating the growth we experienced in 2014 and also finalising terms for new business acquisitions hopefully to set up this year’s growth.
During 2015, we announced the purchase of Birrell Motors Group, our largest-ever business acquisition, representing 12 car and truck brands across Tasmania and the eastern suburbs of Melbourne, with an expected annual revenue of approximately $410 million. This acquisition was completed in March this year, followed by a small acquisition of the Kia and Chrysler Jeep Dodge franchises in Ipswich to be integrated into our Boettchers cluster.
These acquisitions are now being consolidated into our existing operations and are expected to continue our track record of delivering growth in Earnings Per Share to benefit all shareholders.
Our disciplined approach to identifying opportunities, executing transactions and then integrating the acquisitions, has been crucial to the success of our diversification strategy.
Whilst we expect to see further opportunities for the acquisition of core and associated businesses, growth needs to be at a sustainable pace and we will maintain our disciplined approach in parallel with efforts to enhance existing operations and processes.
In relation to Automotive Holdings Group, we remain pleased with our strategic investment, which continues to provide exposure to the West Australian market and additional exposure to the national market in an industry we know and understand.
The Birrell Motors Group includes the following businesses: • Motors Group Tasmania (including state-wide representation for Holden, HSV, Hyundai, Citroen, Isuzu Trucks, Volvo Trucks, Mack Trucks and UD Trucks) • Silver Star Motors (Mercedes-Benz) in Doncaster and Burwood, Victoria • Mercedes-Benz Ringwood, Victoria • Waverley Toyota, Victoria
We are also delighted that the previous owners and operators, Marcus Birrell and Sergio Buccilli, will continue to operate the businesses under AP Eagers ownership, with their expertise to support a platform for further accretive growth in the Victorian and Tasmanian markets.
Negotiations in the second half of 2015 also resulted in the announcement on the 19th of January of the acquisition of the Crampton Automotive Group. The group includes West-Star Motors and Toowoomba Holden operating in Toowoomba, Queensland, and representing the Mercedes-Benz, Hyundai. Peugeot, Citroen, Performax, HSV and Holden brands along with Port City Autos operating in Maryborough and Hervey Bay in Queensland and representing the Holden, Subaru, Chrysler Jeep Dodge, and Isuzu Trucks brands.
I can further confirm the due diligence has been completed and the contract was signed last week with an expected completion date of 1st July 2016.
The annual turnover for these two businesses is $540 million. However, even with their staggered arrival into the group they will still generate an additional $365 million in turnover during calendar year 2016. So by December year end, purely from these 2 acquisitions our annual turnover will lift by 11%. Any additional organic turnover upside will be on top of this 11%.
from APE AGM address
AHE with it's logistics arm will be harder to compare directly
I hold APE ( free-carried ) up 577% since I inherited them in Sept. 2011
tread carefully AHE is bigger ( but a different business)again
thx for this post it is really informative!