British car dealer and distributor Inchcape posted a 76 per cent drop in its April group revenues on Thursday and said the global economic impact of coronavirus-induced lockdowns would be felt until 2021, sending its shares down over 6 per cent in early trade.
The company, which is currently operating in 25 out of its 33 markets, said it was conducting a comprehensive review of its cost base to adjust to the impact.
Last month, it scrapped dividend and cut management pay, as it explored debt options to maintain liquidity.
The company, which sells new and used cars, including premium brands such as BMW, Audi and Mercedes-Benz, said revenue fell 30 per cent to £2 billion (€2.2 billion) for four months ended April 30th.
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"Overall, group revenues in April were down 76 per cent LFL, mainly due to the disruption caused by Covid-19. The impact of closures on profitability will be pronounced, and result in a drop-through to operating profit of approximately 10 per cent of lost revenues," said chief executive Stefan Bomhard.
Inchcape had warned in February of a small drop in 2020 earnings, as the car dealer and distributor battled weaker demand in Hong Kong, Chile and Australia.
The global shutdowns have taken a toll on auto retailers, which were already struggling with a fall in demand and a squeeze on margins in the past year under the weight of Britain's long-drawn exit from the European Union.
Separately, its smaller rival Pendragon - which had earlier in the month called off its merger talks with Lookers - posted a smaller first quarter loss and said that it currently expects to open its dealerships from June 1st. – Reuters