Colonial Motor Co reports a 5.2% dip in first-half profit

Colonial Motor Co reported a 5.2% drop in first-half profit and while it was guardedly positive about the immediate future it signalled several risks.

The company said profit fell to $10.5 million in the six months to December 31 from $11.1 million in the same period a year earlier as trading revenue dipped 0.3% to $437.46 million.

While net profit was down, its trading profit after tax – which does not include the fair value revaluation of property, deferred tax on property depreciation, any realised gain on the sale of property, the fair value revaluation of investments and the impairment of intangible assets – was a record high $10.3 million, up 8.9% on the year.

According to the company, the new vehicle market continues to grow and there are strong forward orders for heavy trucks.The new vehicle industry for the full year 2016 grew 9.5% to a new all-time record of 146,753 registrations, it said. It noted the parts of the business that are reliant on the agricultural economy are beginning to see signs of an uplift. "The outlook for the immediate future is positive," it said.

However, it also noted that in contrast to the previous year, trading profit in the six months was stronger at the beginning of the period than at the end and "there is heightened risk that international events could impact on consumer confidence which is so essential to our success."

Colonial Motor Co will pay a first-half dividend of 13cps on April 18, unchanged from the year-earlier period.

The shares were unchanged at $7.60 and were up 49% over the past 12 months.