British car dealership firm Vertu Motors has warned of a £5.5million hit to its annual profit amid ‘significant disruption’ to its Jaguar Land Rover showrooms.
Luxury carmaker JLR paused production for five weeks following a crippling cyber-attack, leaving many of the group’s suppliers fighting for survival.
Robert Forrester, chief executive of Vertu, said it was ‘disappointing for the industry to face major disruption across the JLR network’ in September, a key month for car sales as number plates are changed.
He added: ‘Whilst the situation is fluid, it appears to be easing in recent days.
‘We are currently working with our insurance brokers and insurers to assess a potential claim under our insurance policy, which extends to the impact of third-party systems outages.’
JLR confirmed that output at some of its manufacturing sites will resume on Wednesday.
Impact: Vertu Motors has warned of a £5.5m hit to its annual profit amid ‘significant disruption’ to its Jaguar Land Rover showrooms
The phased return of staff will begin at some sites in the West Midlands and Merseyside, JLR said.
This week JLR also announced a programme to fast-track payments to its direct suppliers, some of which had laid off staff after their revenues dried up following the cyber-attack.
JLR sales in the UK were down nearly a third as the business reeled from the impact of the cyber-attack, which crippled it to the point that it has not produced a single vehicle since the end of August.
On Wednesday, Gateshead-based Vertu reported record half-year sales of £2.51billion for the six months to the end of August, up from £2.47billion a year earlier. Adjusted pre-tax profit slipped 10 per cent to £20million.
Excluding this one-off impact of the JLR cyber-attack, the underlying profit before tax of the group for the full year is expected to be in line with market expectations.
Vertu saw like-for-like new retail vehicle sales rise 1.8 per cent in September, while the UK new retail market grew 8.9 per cent ‘augmented by tactical pre-registration activity’, it added.
Used vehicle sale volumes on a like-for-like basis were up year-on-year in September by 5.8 per cent.
The volume of battery electric vehicle sales increased by 82.4 per cent on a like-for-like basis compared to a year ago.
Vertu said this was partly due to the cars becoming more affordable, with over 40 models now available under £30,000, and some options under £20,000.
But Vertu stressed that the car market was continuing to face ‘upheaval’ as a result of the government’s zero emission vehicle mandate.
Vertu shares were down 3.01 per cent or 1.80p to 58.10p on Wednesday.
Neil Shah, executive director of content and strategy at Edison Group, said: ‘Investors should note the temporary JLR cyber-attack headwind and ongoing macroeconomic uncertainty, but underlying profitability and operational improvements suggest resilience and potential for long-term value creation.’
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