Yahoo Finance

• Revenue: GBP9.3 billion, with a 4% growth in constant currency terms.

• Operating Margin: 6.3% for the year.

• Adjusted Profit Before Tax (PBT): GBP444 million, a 5% increase in constant currency.

• Free Cash Flow: GBP462 million, with a 151% conversion rate to adjusted profit after tax.

• Net Debt: Reduced to GBP190 million, with a closing leverage of 0.3 times.

• Return on Capital Employed: 27%.

• Adjusted Basic EPS: 71.3p.

• Total Dividend Per Share: 28.5p, with a final dividend of 17.2p.

• Contract Wins: 22 new distribution contracts in 2024.

• Share Buyback Program: New GBP250 million announced.

• Warning! GuruFocus has detected 2 Warning Sign with FRA:IJCA.

Release Date: March 04, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Inchcape PLC (FRA:IJCA) announced a new GBP250 million share buyback program, reflecting a commitment to returning value to shareholders.

• The company delivered 4% revenue growth and 5% profit before tax (PBT) growth in 2024, showcasing strong financial performance.

• Inchcape PLC (FRA:IJCA) set new medium-term targets, including a target of EPS compound annual growth in excess of 10%, indicating confidence in future growth.

• The company achieved a record year with 22 distribution contract wins, expanding its market presence and partnerships.

• Inchcape PLC (FRA:IJCA) has a clear capital allocation policy, including dividends at 40% of EPS and ongoing share buybacks, ensuring disciplined financial management.

Negative Points

• The Americas region saw a 4% decline in revenue, highlighting challenges in certain markets.

• Operating margins slightly decreased to 6.3%, partly due to regional mix and currency headwinds.

• The company faces competitive dynamics and market volatility, which could impact future growth and margins.

• Inchcape PLC (FRA:IJCA) mutually agreed to end four immaterial distribution contracts, indicating potential challenges in maintaining certain partnerships.

• The effective tax rate increased to 31.3% due to new tax regulations, impacting net profitability.

Q & A Highlights

Q: Can you clarify if the volume growth target includes contract wins in terms of the organic growth rate? Also, how should we think about market growth in high-growth versus mature markets? A: (Adrian Lewis, CFO) Yes, contract wins will be a significant driver of growth beyond the market tailwinds of 1% to 2%. The contracts signed since 2021 are still maturing and will drive market outperformance. (Duncan Tait, CEO) We expect structural growth in markets with lower motorization rates compared to Europe and the US. However, we are taking a prudent view on market growth due to changing global conditions.