Online platform Auto Trader has posted strong revenue and profit growth within its core business in its latest financial first-half results for the six months ending 30 September.
Group revenue rose by 8% to £302.5 million, with core business revenue increasing by 9% to £283.5m, supported by continued growth in retailer revenue and an unexpected rise in activity on retailer forecourts.
Autorama, Auto Trader’s online vehicle leasing segment, reported revenue of £19m as it focused on scaling for profitability in a low-transaction-volume market.
Group operating profit climbed by 14% to £188.4m, aided by an £8.4m reduction in central costs, primarily due to deferred charges from the prior year. This raised the operating profit margin to 62%.
The core business’s operating profit was £197.5m, yielding a 70% profit margin. Profit before tax rose by 15% to £187.5m, with basic earnings per share up by 22% to 15.56p.
Within the UK car market, the business said used car demand remained strong with transaction volumes increasing alongside high platform engagement. Speedier sales contributed to a gradual vehicle supply constraint, typical of post-COVID trends.
Used car prices remained relatively stable on a month-to-month basis, while new car registrations saw a marginal year-on-year increase, driven primarily by fleet demand, as private registrations fell by 10%.
Retailer forecourt partnerships grew to 13,986, driven by small to mid-size partners while the number of live listings rose by 2% to 448,000, bolstered by an uptick in private listings.
Retailer growth, particularly from smaller partners, fuelled revenue, while ARPR rose by 6.3% to £2,852 per month. In April, the company introduced a new Auto Trader Connect module, enhancing the Retail Check function and delivering near-real-time data to help retailers make informed pricing and sourcing decisions.
Investments in new car experiences have seen significant traction, with 2,300 franchise retailers now using Auto Trader to advertise new cars.
Auto Trader said its data-driven platform continues to underpin both business operations and customer support, with machine learning models and AI tools driving features such as the newly launched Co-driver, which streamlines vehicle descriptions and image categorisation for retailers.
Digital retailing with Auto Trader’s Deal Builder product, which allows users to manage vehicle reservations, financing, and trade-ins also advanced. The tool now serves approximately 1,500 retailers with 55,000 live vehicles and generated over 23,000 transactions during the period.
Nathan Coe, chief executive of Auto Trader, said: “As well as the hard work and commitment from everyone right across our business, I believe the performance of the last six months is testament to the partnerships we’ve built with our customers. We have continued to invest in our platform to improve the car buying and selling experience and to ensure we remain the most effective and efficient way to source, price and sell vehicles for our retailer partners. As a result, we are working in partnership with a record number of retailers and manufacturers.
“In the last few months alone, we’ve launched our largest ever brand marketing campaign, strengthened our partnership with What Car? into new cars and we’ve also just introduced a new suite of AI-powered solutions, Co-Driver. Encompassing the full scale of our unique data and consumer insights, it marks the pinnacle of more than a decade of investment, and I believe it has the ability to revolutionise automotive retailing.
“The industry faces several forces of change that are fuelling uncertainty and creating complexity for retailers. Our performance means we can continue to invest to build the best team, create market leading technology, data and tools to help all of our partners to navigate this changing context.”
