Newspaper article The Journal (Newcastle, England)

Motor Dealership Drives Forward with Expansion

Newspaper article The Journal (Newcastle, England)

Motor Dealership Drives Forward with Expansion

Article excerpt

Byline: Christopher Knox

MOTOR dealership Vertu Motors is defying the slump in the car market by placing pounds 30m in shares as a way of funding a major expansion programme which could see it create hundreds of jobs in the North East.

The firm, which is based in Newcastle, is to issue shares to help it buy dealerships at affordable prices and grow its portfolio of 45 dealerships to over 50 during the next two years.

Although a number of smaller dealerships are struggling to attract customers back to their forecourts, Vertu's rapid growth since forming in 2006 has allowed it to become the ninth biggest dealer in the country.

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As well the share issue, the firm yesterday announced sales in the year to February of pounds 760.8m, compared to sales of pounds 677.2m in its first 16 months of trading on the stock market.

However, it did report a slight drop in profits from pounds 137,000 to pounds 68,000 but said that its low earnings were a consequence of its aggressive expansion strategy, which recently resulted in the launch of two new Bristol Street Motor Nation used car outlets in Doncaster and Darlington.

The firm said that it would be investing heavily in its service and maintenance operations, which represent 50% of its sales, and said that this side of the business had benefited from the fact that many cash-conscious consumers are sticking with their current vehicles. The firm, which started out with the pounds 69m purchase of Bristol Street Motors, employs 2,050 staff around the country and expects the North East to be its key area of future expansion - where it currently employs over 200 staff.

It has added around 40 jobs in the region over the last six months through the opening of a call centre at its Vauxhall dealership on Scotswood Road, Newcastle, the new dealership at Darlington and new jobs at its head office on the Quayside. …

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