Carcraft profits dip

Date article online: 17/03/2008

The parent company of Rochdale-based car hypermarket Carcraft, UK Car Group, has unveiled a 44 per cent increase in sales from £250m to almost £360m in the year to September 30.

However, £10m of its growth results from changes to the way in which it calculates commission both from its finance and extended warranty sales.

Profits at the firm dipped from £1.9m to £1.6m as wages and other costs increased. There was also an exceptional charge of £4.7m made up of a £3.4m write-down in goodwill inherited from the acquisition of sites from rival Switch Car in November 2005, and a £1.2m provision for the reorganisation of its service centres, which included redundancy payments to 21 workers who did not wish to move from Rochdale to preparation centres at Merseyside and the West Midlands.

Concern mounts over the jobs of the remaining 220 people employed at its headquarters in Castleton as protracted negotiations with Rochdale Development Agency regarding a site for its new head office at the Kingsway Business Park continue. As a consequence, the jobs could be lost to Rochdale as Carcraft look at relocation options outside Rochdale.