Inchcape (INCH) Q1 2025 TU earnings summary

Executive summary

• Q1 2025 results were in line with expectations, with market share gains and seven new contract wins, including Smart in the Americas and BYD in Latvia and Lithuania.

• New vehicle volumes declined 3%, outperforming underlying industry volumes, despite a 5% organic revenue drop due to mixed market momentum and tough comparators.

• Group revenue reached GBP 2.1 billion, down 5% in constant currency and 8% reported due to currency headwinds.

• The company remains focused on cash generation, disciplined cost management, and maintaining leverage well below its one-times limit.

• Operational resilience demonstrated through a diversified business model and proactive management in uncertain markets.

Financial highlights

• Q1 revenue was GBP 2.1 billion, down 5% in constant currency and organically, and down 8% reported due to 3% currency headwinds.

• Organic revenue decreased 5% year-over-year, reflecting mixed market momentum and tough comparators.

• Americas showed continued performance improvement and growth; APAC faced headwinds; Europe & Africa saw lower revenues due to order bank unwind.

• Share buyback program of GBP 250 million underway, with GBP 54 million repurchased to date.

• Market share gains were achieved in key regions, notably in the Americas and Europe.

Outlook and guidance

• Full year 2025 guidance remains unchanged, with growth expected in the second half, particularly in APAC, due to product cycles and contract wins.

• No material changes to product cycle timing or contract ramp-ups; cautious approach to inventory and supply in light of evolving tariffs.

• A pre-close trading update will be provided in late June to update on the tariff situation.

• Medium-term focus remains on delivering greater than 10% EPS CAGR.