Another stellar set of results have driven up dividends at Gateshead car retailing group Vertu plc.
The 116 showroom-strong group saw revenue rise to more than £2bn in the year ended February 28, 2015, up from £1.7bn the year before.
Vertu has continued its acquisitive strategy having bought or opened 14 new outlets across the UK since the beginning of March 2014.
Pre-tax profits rose 32.9% to £21m during the period, fuelled by acquisitive and organic growth.
The firm’s aftersales functions reported higher customer retention rates with over 71,000 people signed up to Vertu service plans, up from 55,397 previously.
Earnings growth led the Vertu board to propose an increase in the final dividend to 0.7 pence per share, up from 0.5 pence in 2014. That will be paid on July 28 2015, and, together with an interim dividend paid in January, the total dividend for the year will reach 1.05 pence per share, up from 0.8 pence.
Robert Forrester, chief executive of Vertu said: “The group is delivering a strong trading performance driven through its successful acquisition growth strategy and improvements in its underlying organic performance. Many businesses within the dealership portfolio in the group have the potential to achieve enhanced margins.
“We have substantial funds and financial capacity for further expansion and continue to see attractive acquisition opportunities.
“In view of the confidence the board has in the group’s prospects, we today announce that, following a review of dividend policy, the board intends to increase the dividend and adopt a dividend cover moving closer to four times. The proposed full year dividend represents an increase of 31.3% as the board focuses on delivering enhanced shareholder returns.”
In conjunction with its full year results Vertu also announced the appointment of ex-Arthur Andersen partner and prominent city executive director Ken Lever, who joins the firm as non executive director.
Mr Lever will replace David Forbes, a Vertu non executive director of six years, who is expected to resign in July.
Vertu chairman Peter Jones welcomed Mr Lever’s appointment and thanked Mr Forbes for his contribution during the early stages of the group.