- Armstrong dealership has deferred its listings plans on the share market.
- It will wait for stable market conditions to emerge.
- The company says market turbulence, macro-economic conditions and the Russia-Ukraine war are all creating uncertainty.
Armstrong car dealership company has delayed its plans to list on the NZ and the ASX, saying it will wait for more stable market conditions.
It is the country’s leading car dealer and has been testing investors’ interest but announced on Monday that it would defer its delisting plans.
The Company said that it would wait for the market to become more stable as market turbulence, macroeconomic conditions and the Russia-Ukraine war was creating uncertain conditions for investments and investors.
Financial markets have been unpredictable this year as investors try to gauge the impact of global interest rates, rising inflations and the hike in commodity prices.
Against this backdrop, let’s look at 2 NZX-listed dealership companies.
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Turners Automotive Limited (NZX:TRA)
Turners Automotive upgraded its outlook for FY22. It expects to report a pre-tax profit of NZ$42 million-NZ$43 million, despite the impact of the COVID-19 pandemic on its business. It’s an improvement as the company had previously forecast a pre-tax profit of NZ$40 million to NZ$42 million. It also upgraded its full-year dividend payment to 23 cps, up from 22 cps previous year. The dividend is expected to be fully imputed. Turners said that it was a record year for the company and the upcoming results would reflect that. The company had been resilient in the face of the COVID-19 pandemic. The upcoming results would reflect its resilience against the pandemic and that its diversification strategy had worked.
Todd Hunter, chief executive officer of the company, said that the Omicron outbreak was disrupting the used car market and to some extent, operations of the company.
On 21 March, the stock was trading up by 1.47 at NZ$4.170, at the time of writing.
Colonial Motors Company Limited (NZX:CMO)
CMO declared its trading profit after tax at NZ$18.0 million for half year, up 42% over pcp. Its interim dividend remained unchanged at 15cps. The record date for the dividend was 18 March and the payment date is 28 March, respectively.
Detailing trading conditions, CMO pointed out that its major trading operations delivered outstanding results in 1H of the financial year, but this has been the case over the first half of the financial year. Motor vehicles, heavy trucks and tractors all have delivered excellent results, despite a challenging environment.
Supply chain disruptions have caused delays in the delivery of cars, particularly used cars. The supply of new cars has also been a challenge in this half year, the company said.
For the future, CMO is waiting to see the impact of Omicron and the uncertainty around it that would be disruptive to all businesses. However, the consumer demand is strong, but potential headwinds can impact the results in 2HFY22.
On 21 March, the stock was trading flat at 10.91, at the time of writing.
Bottom Line: Armstrong cancelled its impending listing on stock exchanges of NZ and Australia today. Let’s see what impact it will have on other dealership companies.