Colonial nets record profit

Colonial Motor Company has announced a record profit of $27.9 million for the year ended June 2021 despite Covid continuing to impact on the new-vehicle supply chain.

The latest profit for the company, which operates 20 dealerships nationwide, increased by 61 per cent from last year and was up 13 per cent on its previous best figure in 2018.

Jim Gibbons, chairman, says: “Demand for all new vehicles has been very strong. Supply to meet this demand has been variable, arrivals are often late and lumpy, sometimes significantly so. 

“However, when looked at on a longer year-to-date basis, supply has grown to meet the demand.”

He highlights how new-vehicle registrations for the first six months of this calendar year were a record 84,598 units.

Gibbons, pictured, expects the current favourable trading conditions, with strong demand for new vehicles but constrained by supply difficulties, to continue for the immediate future. 

However, he warns that may change once the clean car discount scheme is introduced in January 2022.

“In the medium term, the planned new vehicle taxes will change the pricing relativity of vehicles, but the deeper driver of ongoing demand will be the strength of the economy and consumer confidence.”

In an announcement to the NZX, he notes all areas of the Colonial business – car dealerships, heavy trucks and tractors – performed well in the past year.

Group revenue was $901m, while total comprehensive income was impacted by a material $25.2m increase in the property revaluation reserve.

Gibbons also announced he will retire following the company’s annual general meeting in November. His departure will come soon after the retirement of Graeme Gibbons, Colonial’s long-serving chief executive, in September.

Independent director Ash Waugh has been appointed by the board to the position of chairman-elect, and the directors have appointed Gillian Watson as an additional director with effect from September 1. She will stand for election by the shareholders at the AGM.

The company reports the new branch facility for Southern Autos Manukau, which represents Suzuki and Isuzu, has opened in Botany. 

Its major developments in Christchurch for Team Hutchinson Ford, and the Lower Hutt Ford and Mazda hub for Capital City Motors are also nearing completion. 

Meanwhile, a property has been purchased in Rotorua to be developed into a truck parts and service facility for Southpac Trucks.