Motorpoint Group PLC, the UK's leading independent omnichannel vehicle retailer, has announced its unaudited interim results for the six months ended 30 September 2023. The company reported a decrease in revenue to £607.2 million, influenced by market headwinds, with retail volumes declining by 18.4% and wholesale volumes by 22.4%. Gross profit also declined due to lower volumes and a fall in finance commissions. However, the company has successfully implemented a right-sizing program, leading to material reductions in the cost base. The increase in finance expense reflects significant interest rate rises in the period. The company reported a net cash position of £11.2 million, reflecting working capital management and reduced capital investment.

In terms of operational and strategic highlights, Motorpoint reported a market share of 2.5% for 0-5 year old vehicles, a decrease of 0.2 percentage points compared to the previous year. The company's e-commerce revenue also decreased by 36.0%. The number of vehicles sold decreased by 19.8%, with retail sales declining by 18.4% and wholesale sales declining by 22.4%. The company's customer acquisition cost per retail unit decreased by £52. Motorpoint opened its Ipswich store during the period, bringing the total number of market locations to 20.

Motorpoint implemented an operating margin enhancement program to address market challenges, including elevated interest rates and reduced consumer demand. The company focused on improving unit metal margins, reducing operating costs, and generating cash. This included increasing retail margins, streamlining the organizational structure, and reducing discretionary capital spend. The company also invested in digital capabilities, with improvements made to its website and the introduction of automation benefits.

Looking ahead, Motorpoint acknowledges that the impact of high inflation, interest rates, and consumer uncertainty continues to affect demand for used cars. The value of used cars has fallen since the end of the reporting period, with a reduction in wholesale values of approximately 6% in the last six weeks. However, the company believes its lean cost base positions it well to weather this period, and the correction in values is expected to benefit the company in the future as the used car market normalizes.