- Revenue up 4% to March 2020
- Audience visits increased by 3% and share of time spent by buyers on automotive platforms was up to over 75%
- Monetised new car proposition, with over 50,000 new cars now onsite as of June 2020
- No final dividend proposed given the current uncertainties surrounding the COVID-19 pandemic
- Company confirms plan to re-pay furlough money claimed under the CJRS
Auto Trader, the UK’s largest marketplace for new and used cars, has today reported its financial results for the year ended 31 March 2020. The focus of these results has understandably been on trading since year end and the impact of COVID-19.
Supporting its customers through COVID-19
Between 24 March 2020 and various points in June depending on location, retailers were required to close their showrooms. During this time, Auto Trader stopped charging its customers for advertising services. In addition, the Group extended payment terms for March services by 60 days. This ensured it would not be a cash burden on its customers’ businesses during this time.
On top of this financial support, just prior to the lockdown, Auto Trader implemented a stock offer so that retailers could advertise all of their vehicles on the platform. This resulted in up to 80,000 more vehicles on Auto Trader.
The Group worked to launch a powerful new data tool, Market Insight, earlier than anticipated, enabling retailers to identify and adapt to market trends in supply, demand and pricing as they happen. In addition, it created ways for retailers to advertise their vehicles more effectively through the crisis with safety features, home delivery and live video flags. Finally, from 25 March Auto Trader’s Insight Team started hosting weekly webinars to share data from Auto Trader platforms and to help guide retailers through this turbulent period.
On 25 May the UK Government announced a lessening of the lockdown restrictions in England, allowing retailer forecourts to re-open from 1 June. Auto Trader announced on 27 May further support for those customers by implementing a 25% discount for the month of June. England has subsequently been followed by Northern Ireland (8 June) and Wales (22 June) whilst retailers in Scotland will reopen on 29 June.
Supporting its business through COVID-19
Auto Trader used the Coronavirus Job Retention Scheme (‘CJRS’) and furloughed those employees that were unable to perform their roles during the time in which retailers were forced to close their showrooms. The Group supplemented the level of support provided by the Government, such that the large majority remained fully paid.
The government support was taken at a time when the Group faced great uncertainty, but as the crisis passes the Group will repay amounts claimed through the CJRS.
Auto Trader’s Executive Directors forewent 50% of their salary during this period of uncertainty and agreed to forego annual bonuses earned in relation to the year ended 31 March 2020. Salaries will return to normal levels in July 2020. Finally, no final dividend has been proposed given the current uncertainties surrounding the COVID-19 pandemic.
Summary of performance to March 2020
Revenue increased by 4% to £368.9 million (2019: £355.1 million), and Operating profit was up 6% to £258.9 million (2019: £243.7 million).
Auto Trader continues to be the primary place where consumers go to buy and sell cars. It has more listings than any other classified site, which when combined with its significant audience means its by some way the UK’s largest and most engaged digital automotive marketplace. Audience performance has been strong over the year, with cross platform visits up 3%, at an average of 50.8 million per month (2019: 49.1 million). Its competitive position has strengthened with over 75% of all minutes spent on automotive marketplaces now spent on Auto Trader (2019: 73%). This is in part due to the strong organic audience that it enjoys, with 91% of traffic coming either direct or through organic search.
The level of live stock on the site increased by 4% in the year, as the average number of cars on its marketplace rose to 478,000 (2019: 461,000). The growth was driven by the New Car product with over 31,000 physical new cars available on average in Auto Trader through the year (2019: 12,000) and over 50,000 as at June 2020.
Auto Trader continues to improve its onsite experience, enhancements during the year included: improving price indicators which appear on full page adverts with the addition of ‘fair’ and ‘higher’ price flags; the introduction of vehicle provenance history checks; a change in the search sort order to reflect relevance for buyers; Text Chat functionality; and an increase in the number of dealer reviews onsite, now at over one million in total.
Following year end, Auto Trader removed standard format display advertising from its search experience, making retailer adverts larger and driving improved response. Search on mobile devices was also enhanced, increasing the size of each retailer advert by 40%.
Dealer Auction, Auto Trader’s joint venture with Cox Automotive, completed the re-platforming and integration of the three component businesses in early 2020, moving on to Auto Trader’s platform setting the business up to leverage the scale of both Auto Trader and Cox Automotive.
In 2020, Auto Trader’s total tax contribution was £153m. The Group’s total tax contribution is a measure of the taxes that it pays on all of its activities, as well as the taxes that it collects on behalf of tax authorities.
Nathan Coe, Chief Executive Officer of Auto Trader, said: “We are pleased with our achievements in the past financial year, however we recognise these have been well and truly surpassed by the events of the past few months. Through this time, we have been absolutely committed to supporting our people and customers in the face of the most challenging conditions ever experienced by our company or industry.
“Since the early stages of the pandemic we have endeavoured to act decisively and responsibly to ensure we and our customers could emerge in as strong a position as possible when the crisis passes. We’ve been encouraged by the strong initial bounce back in used car demand, and whilst the short-term outlook remains uncertain, we believe the case for moving more of the car buying process online is stronger than ever. We are looking forward to making this a reality with our customers in the years ahead.
“We would like to take this opportunity to thank our people for their unwavering commitment and support, and our customers for their trust in us through these most trying of times.”
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About Auto Trader
Auto Trader Group plc is the UK and Ireland's largest digital automotive marketplace. Auto Trader sits at the heart of the UK's vehicle buying process and its primary activity is to help vehicle retailers compete effectively on the marketplace in order to sell more vehicles, faster. Auto Trader listed on the London Stock Exchange in March 2015 and is now a member of the FTSE 100 Index.
For more information, please visit http://plc.autotrader.co.uk
For all media enquires: Laura Harvey firstname.lastname@example.org or call 07990 828856.