CMH dented by Covid impact


CMH dented by Covid impact

Published Date: 2020-09-30 | Source: Stephen Gunnion | Author: Stephen Gunnion

CMH dented by Covid impact

The car dealership and rental group says its operations were closed at the height of the lockdown as they were not essential services.

Combined Motor Holdings will report a first-half loss after the Covid-19 lockdown resulted in substantial trading losses between March and May. However, that was followed by positive returns for the following three months.

In a trading statement, the automotive investment group said its operations were effectively closed from 27 March until the phased opening from mid-May as they weren't classified as essential services. The recovery since then had seen parts and service trading levels at 80% to 90% of the corresponding months last year. New vehicle sales had reached 70% and used vehicle sales 90% of the prior year months and it expected these levels to be maintained for the rest of its financial year.

Its car finance joint ventures were impacted by severe bad debt provisions and it said time would tell whether the provisions would prove to be sufficient or excessive.

Its car hire business was hardest hit and its recovery had been slow but steady. The business had been right-sized, with a reduced employee headcount and a scaled back rental fleet, which would be at its optimum level by the end of next month.

For the six months to end-August, it expects to report a headline loss per share of 12c to 16c, down from earnings of 120.9c last year. Its basic loss is expected to be between 17c and 21c per share compared with a profit of 121.2c last year.

Its shares closed unchanged at R11.25 yesterday.

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