Half-year Report

CONSOLIDATED STATEMENT OF CASH FLOWS

FOR THE SIX MONTHS ENDED 30 JUNE 2025

 

		Six months to 30 Jun 2025	Six months to 30 Jun 2024
	Notes	£m	£m
Cash generated from operating activities
Cash generated from operations	8a	238	443
Tax paid		(81)	(80)
Interest received		39	20
Interest paid		(84)	(100)
Net cash generated from operating activities		112	283
Cash flows from investing activities
Acquisition of businesses, net of cash and overdrafts acquired		1	-
Net cash inflow from sale of businesses	9a	9	-
Purchase of property, plant and equipment		(16)	(34)
Purchase of intangible assets		-	(2)
Proceeds from disposal of property, plant and equipment		8	4
Dividends received from joint ventures and associates		1	1
Receipt from finance sub-lease receivables		1	1
Net cash generated from/(used in) investing activities		4	(30)
Cash flows from financing activities
Share buyback programme		(154)	-
Purchase of own shares by the Inchcape Employee Trust		(11)	(7)
Cash inflow/(outflow) from revolving credit facility	8b	160	(20)
Net cash outflow from other borrowings	8b	(10)	(110)
Payment of capital element of lease liabilities	8b	(36)	(43)
Equity dividends paid	7b	(66)	(100)
Dividends paid to non-controlling interests		(6)	(9)
Net cash used in financing activities		(123)	(289)
Net decrease in cash and cash equivalents	8b	(7)	(36)
Cash and cash equivalents at beginning of the period		366	440
Effect of foreign exchange rate changes		(27)	(18)
Cash and cash equivalents at end of the period		332	386
Cash and cash equivalents consist of:
Cash at bank		514	560
Short-term deposits		55	87
Bank overdrafts		(237)	(267)
Cash and cash equivalents included in disposal groups held for sale	9b	-	6
		332	386

 

The notes on pages 16 to 38 are an integral part of these condensed consolidated financial statements.

NOTES (UNAUDITED)

1 BASIS OF PRESENTATION AND ACCOUNTING POLICIES

 

Basis of preparation

The condensed consolidated interim financial statements for the period ended 30 June 2025 have been prepared on a going concern basis in accordance with UK-adopted International Accounting Standard 34 'Interim Financial Reporting' and the Disclosure and Transparency Rules of the Financial Conduct Authority. These condensed consolidated interim financial statements should be read in conjunction with the Annual Report and Accounts 2024, which have been prepared in accordance with UK-adopted International Financial Reporting Standards (IFRS) and the Companies Act 2006 applicable to companies reporting under IFRS.

These condensed consolidated interim financial statements are unaudited but have been reviewed by the external auditors. The condensed consolidated interim financial statements in the Interim Report do not constitute statutory accounts within the meaning of Section 434 of the Companies Act 2006. The Group's published consolidated financial statements for the year ended 31 December 2024 were approved by the Board of Directors on 3 March 2025 and delivered to the Registrar of Companies.

The report of the auditors on those accounts was unqualified and did not contain an emphasis of matter paragraph or a statement under section 498 of the Companies Act 2006. The condensed consolidated interim financial statements on pages 10 to 38 were approved by the Board of Directors on 28 July 2025.

Going concern

Based on the Group's cash flow forecasts and projections, the Board is satisfied that the Group will operate within the level of its committed facilities for the foreseeable future. For this reason, the Board continues to adopt the going concern basis in preparing its financial statements. In making this assessment, the Group has considered available liquidity in relation to net debt and committed facilities, the Group's latest forecasts for 2025 and 2026 cash flows, together with adjusted scenarios.

Committed bank facilities and Private Placement borrowings amount to £1,040m, of which £355m was drawn at 30 June 2025. In June 2023, the Group issued a £350m bond offering with a coupon of 6.5%, due to mature in June 2028.

The Private Placement loan notes are subject to an interest cover covenant based on an adjusted EBITA measure to interest on consolidated borrowings measured on a trailing 12-month basis at June and December.

The latest Group forecasts for 2025 and 2026 indicate that the Group is expected to be compliant with this covenant throughout the forecast period and have sufficient liquidity to continue operating throughout that period.

A range of sensitivities has been applied to the forecasts to assess the Group's compliance with its covenant requirements over the forecast period. These sensitivities included:

•    a 12-month reduction in New and Used revenue from January 2026, resulting from decreasing consumer demand in response to fiscal tightening and resulting economic downturns;

•    a reduction in reported GBP earnings from July 2025 to December 2026 resulting from the strengthening of sterling relative to other currencies;

•    an adverse movement in working capital from January 2026 arising from a combination of an increase in inventory and a general liquidity reduction;

•    with no mitigating actions applied in relation to the sensitivities described above.

In a scenario where all of the above sensitivities occur at the same time, the Group has modelled the possibility of the interest cover covenant being breached in 2025 and 2026. With the interest cover covenant measured on a trailing 12-month basis, the sensitised forecasts indicate that the Group is not expected to breach any covenants and would be compliant with the interest cover requirements throughout the forecast period. Additionally, under these circumstances, the Group expects to have sufficient funds to meet cash flow requirements.

A reverse stress test scenario analysis, concluded that a set of circumstances in which the Group would breach its covenant or have insufficient funds to meet cash flow requirements are considered to be remote, relative to the sensitivities referred to above.

Therefore, the board concluded that the Group will be able to operate within the level of its committed facilities for the foreseeable future. The directors consider it appropriate to adopt the going concern basis of accounting in preparing the condensed consolidated interim financial statements.

Accounting policies

The condensed set of consolidated financial information has been prepared using accounting policies consistent with those in the Group's Annual Report and Accounts 2024 with the exception of the following standards, amendments and interpretations which have been newly adopted from 1 January 2025:

Newly adopted accounting standards

From 1 January 2025, the following standards become effective in the Group's consolidated financial statements:

•    Amendments to IAS 21 - Lack of exchangeability

The adoption of the standards and interpretations listed above has not led to any material impact on the financial position or performance of the Group.

The Group has not early adopted other standards, amendments to standards or interpretations that have been issued but are not yet effective.

Standards not yet effective

The following standards were in issue but were not yet effective at the balance sheet date. These standards have not
yet been early adopted by the Group, and will be applied for the Group's financial years commencing on or after
1 January 2026:

Amendment to IFRS 9 and IFRS 7 - Classification and Measurement of Financial Instruments

IFRS 18 - Presentation and Disclosure in Financial Statements

IFRS 19 - Subsidiaries without Public Accountability: Disclosures

Annual improvements to IFRS - Volume 11

Management is currently reviewing the new standards to assess the impact that they may have on the Group's reported position and performance. Management do not expect that the adoption of the standards listed above will have a material impact on the financial statements of the Group.

Ethiopia ceases to be a hyperinflationary economy

The Group financial statements included adjustments for hyperinflation, following the application of IAS 29 'Financial Reporting in Hyperinflationary Economies' in relation to the Group's operations with a functional currency of Ethiopian Birr since 2022.

As at 30 June 2025, Ethiopia is no longer considered to be a hyperinflationary economy and therefore the Group has not recognised any adjustments in respect of hyperinflation. The Group ceased to apply IAS 29 from the beginning of the reporting period in which hyperinflation ceased, thus from 1 January 2025.

The Group's consolidated financial statements included the results and financial position of its Ethiopian operations restated to the purchasing power or inflationary measuring unit current up until 31 December 2024, leading to a hyperinflationary loss in respect of monetary items being reported in finance costs, and treated as an adjusting item from 2022 to 2024. The results of the Group's Ethiopian operations were translated at the closing exchange rate, as required by IAS 21 'The Effects of Changes in Foreign Exchange Rates' for hyperinflationary foreign operations.

Critical accounting judgements and key sources of estimation uncertainty

The preparation of these condensed consolidated interim financial statements in accordance with generally accepted accounting principles requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Although these estimates are based on management's best knowledge, actual results may ultimately differ from those estimates. The estimates and underlying assumptions are reviewed on an ongoing basis.

The Directors have made a number of estimates and assumptions regarding the future and made some significant judgements in applying the Group's accounting policies. The critical accounting judgements and key sources of estimation uncertainty remain consistent with those presented in the accounting policies note within the Group's 2024 Annual Report and Accounts. Those that are new or significant to the preparation of the interim financial statements are presented below.

 

Impairment of goodwill and other indefinite life intangible assets

The carrying amount of goodwill and other indefinite life intangible assets is shown below:

	As at 30 Jun 2025			As at 31 Dec 2024
	Goodwill £m	Indefinite- life intangible assets £m	Total £m	Goodwill £m	Indefinite- life intangible assets £m	Total £m
At 1 January	272	852	1,124	302	929	1,231
Businesses sold	-	-	-	(4)	-	(4)
Acquisition adjustments (see note 9a)	-	-	-	(1)	-	(1)
Impairment (charge)/reversal	-	-	-	-	19	19
Derecognition	-	-	-	-	(5)	(5)
Effect of foreign exchange rates	(17)	(55)	(72)	(25)	(91)	(116)
At 30 June/31 December	255	797	1,052	272	852	1,124

 

Goodwill acquired in a business combination is allocated to the cash generating units (CGUs) or group of CGUs (hereafter collectively referred to as 'CGU groups') that are expected to benefit from the synergies associated with that business combination. Indefinite-life intangible assets, principally distribution agreements acquired in a business combination,
are also allocated to the CGUs or CGU groups that are expected to benefit from the cash flows associated with the
relevant agreements.

Indicators of impairment in goodwill and other indefinite-life intangible assets

In accordance with the Group's accounting policy, goodwill and other indefinite-life intangible assets are tested at least annually for impairment and whenever events or circumstances indicate that the carrying amount may not be recoverable.

In the first half of 2025, the Group carried out an assessment as to whether any impairment testing is required to be performed for the six months to 30 June 2025. As set out in IAS 36 Impairment of Assets, the assessment involved the Group reviewing potential indicators of impairment to determine if any of the Group's assets should be tested.

The review included examining data trends on asset valuations, reviewing latest macro-economic data including global economic forecasts, reviewing latest industry data including forecasts of industry volumes and comparing the Group's results against cash flows used in previously prepared impairment models and latest forecasts. The conclusion reached from the review performed was that there was no requirement to test any assets or cash generating units for impairment for the six-month period to 30 June 2025.

At 31 December 2024, the Group's value in use calculations prepared for the cash generating units represented by Central America - Suzuki business in the Americas were sensitive to a change in the key assumptions used. The recoverable amount calculated for the Central America CGU was £167m. Cash flows were discounted back to present value using a pre-tax discount rate of 11.7%.

The cash flows used within the impairment model were based on assumptions which are sources of estimation uncertainty and small movements in these assumptions could lead to further impairment. Management performed sensitivity analysis on the key assumptions in the indefinite-life intangible asset impairment model for Central America - Suzuki using reasonably possible changes in these key assumptions. The sensitivities were selected based on the inherent business volatility and the metrics that closely align to the consequences of climate change risks and opportunities detailed on pages 43 to 49 of the 2024 Annual Report and Accounts.

	Increase/ (decrease) in assumption	Decrease in value in use	Impact on carrying value
		£m	£m
Revenue CAGR (%)	(1.0%)	(21)	(8)
Average gross margin (%)	(0.5%)	(11)	-
Pre-tax discount rate (%)	1.0%	(25)	(12)
Long-term growth rate (%)	(0.5%)	(8)	-

 

The value in use calculations for the Hino distribution agreement in South America indicated limited headroom. The cash flows for the Americas - Hino CGU group are sensitive to any change in assumption, with the timing of resumption of supply being of particular significance to the cash flow forecasts. Management performed sensitivity analysis on the key assumptions in the indefinite-life intangible asset impairment model for Americas - Hino using reasonably possible changes in key assumptions.

	Increase/ (decrease) in assumption	Decrease in value in use	Impact on carrying value
		£m	£m
Supply constraint	1 year	(6)	(5)
Average gross margin (%)	(0.5)        %	(4)	(3)
Pre-tax discount rate (%)	1.0     %	(8)	(7)
Long-term growth rate (%)	(0.5)        %	(2)	(1)

 

Classification of vehicle funding arrangements

The Group finances the purchase of vehicles using vehicle funding facilities provided by various lenders including the captive finance companies associated with brand partners. In assessing whether the liabilities arising under these arrangements should be classified within trade and other payables rather than as an additional component of the Group's net debt within borrowings, the Group considers a number of factors including whether the arrangement is a requirement of the relationship with the OEM, in relation to specific, separately identifiable vehicles held as inventory and the duration of the finance. Each agreement entered into has its own terms and conditions and determining whether a new or renewed arrangement should be classified within trade and other payables requires significant management judgement (see note 10c).

Adjusting items

The Directors believe that adjusted profit and earnings per share measures provide additional useful information to shareholders on the performance of the business. These measures are consistent with how business performance is measured internally by the Board and Executive Committee. The operating profit before adjusting items and profit before tax and adjusting items measures are not recognised profit measures under IFRS and may not be directly comparable with such profit measures used by other companies. The classification of adjusting items requires significant management judgement after considering the nature and intentions of a transaction. The Group's definitions of adjusting items are outlined within the Group accounting policies and note 3 provides further details on current year adjusting items and their adherence to Group policy.

In the period, the Group has reported an aggregate pre-tax adjusting items expense of £14m (see note 3). The separate reporting of adjusting items helps provide additional useful information regarding the Group's underlying business performance and is used by management to facilitate internal performance analysis. Items that may be considered as adjusting items include gains or losses on the disposal of businesses, restructuring of businesses, acquisition and integration costs, asset impairments and the tax effects of these items. Any reversal of an amount previously recognised as an adjusting item would also be recognised as an adjusting item in a subsequent period.

Alternative performance measures (APMs)

The consolidated income statement presents only IFRS measures which is in line with the basis of preparation disclosed in this note. The alternative performance measures used by the Group are included in note 14. This includes further information on the definitions, purpose and reconciliation to IFRS measures. 

2 SEGMENTAL ANALYSIS

 

The Group has three reportable segments which have been identified based on the operating segments of the Group that are regularly reviewed by the chief operating decision-maker, which has been determined to be the Group Executive Team, in order to assess performance and allocate resources. Operating segments are then aggregated into reporting segments to combine those with similar economic characteristics.

The Group reports the performance of its reporting segments after the allocation of central costs. These represent costs of Group functions.

The following summary describes the operations of each of the Group's reportable segments:

APAC Europe & Africa Americas

Exclusive distribution, sales and marketing activities of New Vehicles and Parts.   Sale of New and Used Vehicles together with logistics services where the Group may also be the exclusive distributor, alongside associated Aftersales activities of service, body shop repairs and parts sales.

 

	APAC	Europe & Africa	Americas	Total
Six months to 30 June 2025	£m	£m	£m	£m
Revenue
Total revenue	1,227	1,582	1,511	4,320
Adjusted operating profit from continuing operations	79	78	90	247
Operating adjusting items				(14)
Operating profit from continuing operations				233
Share of profits after tax of joint ventures and associates				1
Profit before finance and tax				234
Finance income				36
Finance costs				(84)
Profit before tax from continuing operations				186
Tax				(57)
Profit for the year from continuing operations				129

 

The Group's reported segments are based on the location of the Group's assets. Revenue earned from sales is disclosed by origin and is not materially different from revenue by destination. Chile, Australia and Belgium are presented separately as these comprise more than 10% of the Group's revenue. Revenue is further analysed as follows:

Six months to 30 June 2025	£m
Chile	671
Australia	491
Belgium	460
Rest of the world	2,698
Group	4,320

 

 

	APAC	Europe & Africa	Americas	Total
Six months to 30 June 2024	£m	£m	£m	£m
Revenue
Total revenue	1,495	1,622	1,608	4,725
Adjusted operating profit from continuing operations	116	85	98	299
Operating adjusting items				(23)
Operating profit from continuing operations				276
Share of losses after tax of joint ventures and associates				1
Profit before finance and tax				277
Finance income				22
Finance costs				(104)
Profit before tax from continuing operations				195
Tax				(71)
Profit for the year from continuing operations				124

 

The Group's reported segments are based on the location of the Group's assets. Revenue earned from sales is disclosed by origin and is not materially different from revenue by destination. Chile and Australia are presented separately as these comprise more than 10% of the Group's revenue. Revenue is further analysed as follows:

Six months to 30 June 2024	£m
Chile	738
Australia	595
Rest of the world	3,392
Group	4,725

 

3 ADJUSTING ITEMS

 

	Six months to 30 Jun 2025	Six months to 30 Jun 2024
From continuing operations	£m	£m
Acquisition and integration costs	(4)	(23)
Restructuring costs	(6)	-
Loss on disposal of business (see note 9a)	(4)	-
Total adjusting items in operating profit	(14)	(23)
Adjusting items in finance costs:
Net monetary loss on hyperinflation	-	(8)
Total adjusting items before tax	(14)	(31)
Tax on adjusting items (see note 5)	2	3
Total adjusting items	(12)	(28)

 

During the period, operating costs of  £4m (2024: £23m) were incurred in connection with the acquisition and integration of businesses. These costs have been reported as adjusting items to better reflect the underlying performance of the business. These primarily relate to the acquisition and integration of the Derco group and other businesses acquired. The integration of the Derco group is a multi-year programme, with cumulative costs to date of £70m, that is expected to complete in the second half of 2025.

Partly driven by the potential medium-term impact of the tariff situation on the Group's operations, restructuring activity has been undertaken by the Group and the associated costs have been recognised as an adjusting item in line with the Group's policy.  Restructuring costs have only been recognised once formal plans are in place and their implementation has commenced or been announced to those affected.  Restructuring costs have also been recognised in relation to Group-wide transformation projects impacting back-office operations, including a review of organisational structures, internal processes and the physical location of certain operations.  Execution of the Group-wide restructuring activities commenced in the first half of the year, with activities expected to continue into the first half of 2026.

In December 2024, the Group sold its share in its non-genuine spare parts business in Chile and a gain on disposal of £6m was reported as an adjusting item.  During 2025, following the finalisation of the completion accounts for the disposal, there was an adjustment of £4m in favour of the buyer.  This adjustment to the sale proceeds has been reported as an adjusting item for consistency with the amount reported in 2024.

The Group financial statements include adjustments for hyperinflation, following the application of IAS 29 Financial Reporting in Hyperinflationary Economies in relation to the Group's operations with a functional currency of Ethiopian Birr. The results and financial position of Ethiopia for the six months ended 30 June 2024 were restated to include the effect of indexation and the resulting  net monetary loss on hyperinflation  of £8m was recognised within net finance costs and reported as an adjusting item. As at 30 June 2025, Ethiopia is no longer considered to be a hyperinflationary economy and therefore the Group has not recognised any adjustments in respect of hyperinflation for the six months ended 30 June 2025. The Group ceased to apply IAS 29 from the beginning of the reporting period in which hyperinflation ceased, thus from 1 January 2025.

4 NET FINANCE COSTS

 

	Six months to 30 Jun 2025	Six months to 30 Jun 2024
From continuing operations	£m	£m
Interest expense on bank and other borrowings	52	52
Finance costs on lease liabilities	7	9
Interest on inventory financing	25	26
Net monetary loss on hyperinflation (note 3)	-	8
Other finance costs	-	9
Finance costs	84	104
Bank and other interest receivable	(33)	(18)
Net interest income on post-retirement plan assets and liabilities	(1)	(2)
Other finance income	(2)	(2)
Finance income	(36)	(22)
Net finance costs	48	82
Analysed as:
Net finance costs excluding adjusting finance costs	48	74
Finance costs reported as adjusting items	-	8
Net finance costs	48	82

Other finance costs include fees, commissions and foreign exchange gains and losses.

Since 2022, in accordance with IAS 29 Financial Reporting in Hyperinflationary Economies, the results and financial position of the Group's operations in Ethiopia have been restated to the purchasing power or inflationary measuring unit current at the end of the reporting period. The results and financial position of Ethiopia for the six months ended 30 June 2024 were restated to include the effect of indexation and the resulting  net monetary loss on hyperinflation of £8m was recognised within net finance costs and reported as an adjusting item. As at 30 June 2025, Ethiopia is no longer considered to be a hyperinflationary economy and therefore the Group ceased to apply IAS 29 from the beginning of the reporting period in which hyperinflation ceased, thus from 1 January 2025.

5 TAX

		Six months to 30 Jun 2025	Six months to 30 Jun 2024
From continuing operations		£m	£m
Current tax	- Overseas tax	62	66
	- Pillar 2 income taxes	1	2
Adjustments to prior year liabilities	- Overseas tax	1	-
Current tax		64	68
Deferred tax		(7)	3
Total tax charge		57	71
	- Tax charge on profit before adjusting items	59	74
	- Tax credit on adjusting items	(2)	(3)
Total tax charge		57	71

 

The tax charge for the six months to 30 June 2025 has been calculated by applying the estimated average annual effective income tax rate for each jurisdiction in which Inchcape operates to the interim period pre-tax income of each jurisdiction as required by IAS 34 'Interim Financial Reporting'. Tax credited on adjusting items has been separately calculated and is disclosed above. Details of the adjusting items for the period can be found in note 3.

The effective tax rate for the period to 30 June 2025 is 30.6% compared to 36.4% for the same period last year. The effective tax rate on adjusted profit for the period is 29.5% compared to 32.7% for the same period last year.

The current tax charge for the period to 30 June 2025 includes Pillar 2 top-up tax of £1m (2024: £2m). Of this, £1m (2024: £1m) is domestic top-up tax payable in overseas jurisdictions and £nil (2024: £1m) is payable in the United Kingdom in respect of jurisdictions which have not implemented Pillar 2 legislation.

The total tax charge in the period no longer includes the impact of IAS 29 'Financial Reporting for Hyperinflationary Economies' in relation to the financial position of Ethiopia (see note 3).

Factors affecting current and future tax charges

The Group's future tax charge, and effective tax rate, could be affected by several factors including; the resolution of audits and disputes, changes in tax laws or tax rates, repatriation of cash from overseas markets to the UK, the ability to utilise brought forward losses and business acquisitions and disposals. In addition, a change in profit mix between low and high taxed jurisdictions will impact the Group's future tax charge.

The utilisation of brought forward tax losses or changes in the recognition of deferred tax assets associated with such losses may also give rise to tax charges or credits. The recognition of deferred tax assets, particularly in respect of tax losses, is based upon an assessment of whether it is probable that there will be sufficient and suitable taxable profits in the relevant legal entity or tax group against which to utilise the assets in the future. Judgement is required when determining probable future taxable profits. In the event that actual taxable profits are different to those forecast, the Group's future tax expense and effective tax rate could be affected.

The Group has published its approach to tax on www.inchcape.com covering its tax strategy and governance framework.

 

 6 EARNINGS PER SHARE

	Six months to 30 Jun 2025	Six months to 30 Jun 2024
	£m	£m
Profit for the period	129	129
Non-controlling interests	(4)	(9)
Basic earnings	125	120
Profit for the period from discontinued operations	-	(5)
Basic earnings from continuing operations attributable to owners of the parent	125	115
Adjusting items	12	28
Adjusted earnings from continuing operations attributable to owners of the parent	137	143
Basic earnings per share
Basic earnings per share from continuing operations	32.4p	27.9p
Basic earnings per share from discontinued operations	-	1.2p
Total basic earnings per share	32.4p	29.1p
Diluted earnings per share
Diluted earnings per share from continuing operations	31.8p	27.5p
Diluted earnings per share from discontinued operations	-	1.2p
Total diluted earnings per share	31.8p	28.7p
Adjusted earnings per share from continuing operations
Basic Adjusted earnings per share from continuing operations	35.5p	34.7p
Diluted Adjusted earnings per share from continuing operations	34.9p	34.2p

 

	Six months to 30 Jun 2025	Six months to 30 Jun 2024
	number	number
Weighted average number of fully paid ordinary shares in issue during the period	386,276,551	413,007,132
Weighted average number of fully paid ordinary shares in issue during the period:
- Held by the Inchcape Employee Trust	(629,990)	(974,210)
Weighted average number of fully paid ordinary shares for the purposes of basic EPS	385,646,561	412,032,922
Dilutive effect of potential ordinary shares	7,354,128	6,044,221
Adjusted weighted average number of fully paid ordinary shares in issue during the period for the purposes of diluted EPS	393,000,689	418,077,143

 

Basic earnings per share is calculated by dividing the Basic earnings for the period by the weighted average number of fully paid ordinary shares in issue during the period, less those shares held by the Inchcape Employee Trust.

Diluted earnings per share is calculated on the same basis as Basic earnings per share with a further adjustment to the weighted average number of fully paid ordinary shares to reflect the effect of all dilutive potential ordinary shares. Dilutive potential ordinary shares comprise share options and other share-based awards.

Basic Adjusted earnings (which excludes adjusting items) is adopted to assist the reader in providing an additional performance measure of the Group. Basic Adjusted earnings per share is calculated by dividing the Adjusted earnings for the period by the weighted average number of fully paid ordinary shares in issue during the period, less those shares held by the Inchcape Employee Trust.

Diluted Adjusted earnings per share is calculated on the same basis as the Basic Adjusted earnings per share with a further adjustment to the weighted average number of fully paid ordinary shares to reflect the effect of all dilutive potential ordinary shares. Information presented for diluted and diluted adjusted earnings per ordinary share uses the weighted average number of shares as adjusted for potentially dilutive ordinary shares as the denominator.

 

7 SHAREHOLDERS' EQUITY 

A. Issue of ordinary shares

As at 30 June 2025, the issued share capital of the Company was 372,227,910 shares (June 2024: 413,007,132 shares; December 2024: 394,333,172 shares).

During the period, the Group issued £nil (June 2024 - £nil, December 2024 - £nil) of ordinary shares exercised under the Group's share option schemes.

Share buyback programme

On 4 March 2025, the Group announced a £250m share buyback programme which was expected to conclude within the next 12 months. During the six months ended 30 June 2025, the Company repurchased 22,105,262 shares at a cost of £150m (June 2024: none; December 2024: 18,673,960 shares repurchased in second half of 2024 at a cost of £147m). The cost of the share buyback has been charged to retained earnings. An amount of £2m (June 2024: £nil; December 2024: £2m), equivalent to the nominal value of the cancelled shares, was transferred to the capital redemption reserve.

The Directors have concluded that as at 30 June 2025, under the terms and conditions of the buyback contract with the Group's broker, the Group was not in a position to cancel the obligation arising under the contract. Accordingly, the Group has recorded a share buyback liability of £102m (June 2024: £nil; December 2024: £nil) for this obligation in accordance with IAS 32 'Financial Instruments: Presentation'. The liability is included within trade and other payables and reflects the maximum liability for the purchase of the Company's own shares through to the conclusion of the Group's close period on 29 July 2025.

B. Dividends

The following dividends were paid to equity holders of the parent:

	Six months to 30 Jun 2025	Six months to 30 Jun 2024	Year to 31 Dec 2024
	£m	£m	£m
Final dividend for the year ended 31 December 2024 of 17.2p per share (2023: 24.3p per share)	66	100	100
Interim dividend for the six months ended 30 June 2024 of 11.3p per share (2023: 9.6p per share)	-	-	47
	66	100	147

An interim dividend of 9.5p per share for the period ending 30 June 2025 was approved by the Board on 28 July 2025 and will be paid on 5 September 2025 to shareholders who are on the register at close of business on 8 August 2025. The Dividend Reinvestment Plan (DRIP) is available to ordinary shareholders and the final date for receipt of elections to participate in the DRIP is 14 August 2025.

C. Distributable reserves

Rectification of procedural issue in relation to share buybacks

The Board has recently become aware of a technical issue relating to certain historic purchases of the Company's shares under its share buyback programmes in Q4 2024 and Q1 2025. Whilst the directors were satisfied that the Company had sufficient distributable reserves to support these purchases, certain procedural requirements under the Companies Act 2006 were not satisfied prior to the transactions. This issue is technical in nature and does not have any impact on the Company's current trading, current share repurchases or the payment of any dividends to shareholders. A circular will be sent to shareholders on or around 31 July 2025, convening a general meeting to seek ratification of the relevant share purchases and grant approval for the Company to enter into related agreements to rectify the position. Full details will be set out in the circular.

8 NOTES TO THE STATEMENT OF CASH FLOWS

 

A. Reconciliation of cash generated from operations

	Six months to 30 Jun 2025	Six months to 30 Jun 2024
	£m	£m
Cash flows from operating activities
Operating profit - continuing operations	233	276
Operating profit - discontinued operations	-	7
Adjusting items	14	23
Amortisation including non-adjusting impairment charges	4	5
Depreciation of property, plant and equipment including non-adjusting impairment charges	21	25
Depreciation of right-of-use assets	34	40
Profit on disposal of businesses	(5)	-
Profit on disposal of property, plant and equipment and intangible assets	(2)	-
Gain on changes in right-of-use assets	(1)	-
Share-based payments charge	5	9
(Increase)/decrease in inventories	(279)	330
Increase in trade and other receivables	(25)	(99)
Increase/(decrease) in trade and other payables	251	(142)
Decrease in provisions	-	(6)
Pension contributions less than pension charge for the period	2	-
Increase in interest in leased vehicles	(5)	(4)
Payments in respect of operating adjusting items	(9)	(21)
Cash generated from operations	238	443

 

B. Net debt reconciliation

	Liabilities from financing activities				Assets
	Borrowings £m	Leases £m	Sub-total £m		Cash/bank overdrafts £m	Total net debt £m
Net debt at 1 January 2024	(1,041)	(440)	(1,481)		440	(1,041)
Cash flows	130	43	173		(36)	137
New lease liabilities	-	(40)	(40)		-	(40)
Transferred to assets/liabilities held for sale	-	60	60		-	60
Other non-cash movements	(3)	(1)	(4)		-	(4)
Foreign exchange adjustments	4	11	15		(18)	(3)
Net debt at 30 June 2024	(910)	(367)	(1,277)		386	(891)
Cash flows	354	38	392		(336)	56
Acquisitions	-	-	-		5	5
Disposals	-	38	38		391	429
New lease liabilities	-	(22)	(22)		-	(22)
Other non-cash movements	(1)	-	(1)		-	(1)
Foreign exchange adjustments	1	11	12		(80)	(68)
Net debt at 1 January 2025	(556)	(302)	(858)		366	(492)
Cash flows	(150)	36	(114)		(17)	(131)
Acquisitions	-	-	-		1	1
Disposals	-	-	-		9	9
New lease liabilities	-	(25)	(25)		-	(25)
Foreign exchange adjustments	-	9	9		(27)	(18)
Net debt at 30 June 2025	(706)	(282)	(988)		332	(656)

 

8 NOTES TO THE STATEMENT OF CASH FLOWS

 

Net debt is analysed as follows:

	As at 30 Jun 2025	As at 31 Dec 2024	As at 30 Jun 2024
	£m	£m	£m
Cash at bank and short-term deposits as per the statement of financial position	569	549	647
Cash and cash equivalents included in disposal groups held for sale	-	-	6
Borrowings - disclosed as current liabilities	(239)	(195)	(559)
Add back: amounts treated as debt financing (see below)	2	12	292
Cash and cash equivalents as per the statement of cash flows	332	366	386
Debt financing
Borrowings - disclosed as current liabilities and treated as debt financing (see above)	(2)	(12)	(292)
Borrowings - disclosed as non-current liabilities	(704)	(544)	(618)
Lease liabilities	(282)	(302)	(367)
Debt financing	(988)	(858)	(1,277)
Net debt	(656)	(492)	(891)
Add back: lease liabilities	282	302	367
Adjusted net debt	(374)	(190)	(524)

Borrowings disclosed as current liabilities include bank overdrafts held in cash pooling arrangements which have not been offset in the consolidated statement of financial position. As at 30 June 2024, this included a £250m Term Loan that was repaid in August 2024. Bank overdrafts are included within cash and cash equivalents in the consolidated statement of cash flows.

	As at 30 Jun 2025	As at 31 Dec 2024	As at 30 Jun 2024
Cash at bank	514	458	560
Short-term deposits	55	91	87
Bank overdrafts	(237)	(183)	(267)
Cash and cash equivalents included in disposal groups held for sale	-	-	6
	332	366	386

£23m (31 December 2024: £37m; 30 June 2024: £94m) of cash and cash equivalents is held in Ethiopia where prior approval is required to transfer funds abroad, and currency may not be available locally to effect such transfers.

9 ACQUISITIONS AND DISPOSALS

 

A. 2024 Disposals and discontinued operations

On 1 August 2024 the Group completed the sale of its UK Retail operations to Group 1 Automotive UK Limited, a wholly-owned subsidiary of Group 1 Automotive, Inc. for a cash consideration of £345m. During the first half of 2025, the Group received £4m of deferred consideration relating to the disposal of its UK Retail operations.

The UK Retail operation was reported as a discontinued operation in 2024. Financial information relating to the discontinued operation for the year ending 31 December 2024 is included in note 28a of the Group's 2024 Annual Report and Accounts.

During the first half of 2025, the Group disposed of retail sites in the Americas and Europe generating net disposal proceeds of £5m.

In December 2024, the Group completed the sale of its non-genuine parts business in Chile for £30m, resulting in a £6m gain on disposal. The net gain, which was classified as an adjusting item, included disposal costs and a gain relating to the recycling of cumulative exchange differences previously recognised in other comprehensive income. During 2025, following the finalisation of the completion accounts for the disposal, an adjustment of £4m was made in favour of the buyer. This adjustment to the sale proceeds has been reported as an adjusting item, for consistency with the amount reported in 2024, and as a net cash outflow from sale of businesses in the consolidated statement of cash flows.

 

B. Assets held for sale

	As at 30 Jun 2025	As at 31 Dec 2024
	£m	£m
Assets classified as held for sale	20	20

As at 30 June 2025, assets held for sale relate to retail sites in Australia, the disposal of which is expected to occur in the second half of the year.

 

10 FINANCIAL RISK MANAGEMENT

 

A. Financial risk factors

Exposure to financial risks comprising market risks (currency risk and interest rate risk), funding and liquidity risk and counterparty risk arises in the normal course of the Group's business.

During the six months to 30 June 2025, the Group has continued to apply the financial risk management process and policies as detailed in the Group's principal risks and risk management process included in the Annual Report and Accounts 2024.
The condensed consolidated interim financial statements do not include all financial risk management information and disclosures required in the annual financial statements and further details can be found in note 23 of the Annual Report and
Accounts 2024.

B. Liquidity risk

As at 30 June 2025, the committed funding facilities of the Group comprised a syndicated revolving credit facility of £900m (31 December 2024: £900m), sterling Private Placement Loan Notes totalling £140m (31 December 2024: £140m) and a five-year bond of £350m (31 December 2024: £350m). As at 30 June 2025, £215m of the £900m syndicated revolving credit facility was drawn (31 December 2024: £55m).

The £350m public bond is held at amortised cost and had a fair value of £361m as at 30 June 2025 based on quoted prices. The £140m Private Placement Loan Notes are also held at amortised cost and had a fair value of £138m.

Private Placement Loan Notes of £70m were repaid in May 2024, reducing the total from £210m to £140m.

The Private Placement borrowings are subject to an interest cover covenant based on an adjusted EBITA measure to interest on consolidated borrowings measured on a trailing 12-month basis at June and December. The Group is required to maintain a ratio of not less than three to one and was compliant with this covenant as at 30 June 2025.

C. Vehicle funding arrangements

The Group finances the purchase of new vehicles for sale and a portion of used vehicle inventories using vehicle funding facilities provided by various lenders including the captive finance companies associated with brand partners. Such arrangements generally are uncommitted facilities and have a maturity of 180 days or less. Amounts due under these vehicle funding arrangements are included within trade and other payables in the consolidated statement of financial position. Related cash flows are reported within cash flows from operating activities in the consolidated statement of cash flows. As at 30 June 2025, the total amount outstanding under such arrangements was £1,864m (31 December 2024: £1,582m).

Vehicle funding facilities are subject to SONIA (or similar) interest rates. The interest incurred under these arrangements is included within finance costs in the consolidated income statement and reported as interest on inventory financing (see note 4). Related cash flows are reported as interest paid in the consolidated statement of cash flows.

D. Fair value measurements

In accordance with IFRS 13, disclosure is required for financial instruments that are measured in the consolidated statement of financial position at fair value. There are no non-recurring fair value measurements. This requires disclosure of fair value measurements by level for the following fair value measurement hierarchy:

•    quoted prices in active markets (level 1);

•    inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly (level 2); or

•    inputs for the asset or liability that are not based on observable market data (level 3).

 

The following table presents the Group's assets and liabilities that are measured at fair value:

	As at 30 June 2025				As at 31 December 2024
	Level 1	Level 2	Level 3	Total	Level 1	Level 2	Level 3	Total
	£m	£m	£m	£m	£m	£m	£m	£m
Assets
Derivatives used for hedging	-	27	-	27	-	48	-	48
Financial assets at fair value through other comprehensive income	-	-	4	4	-	-	4	4
	-	27	4	31	-	48	4	52
Liabilities
Derivatives used for hedging	-	(33)	-	(33)	-	(47)	-	(47)
	-	(33)	-	(33)	-	(47)	-	(47)

Level 1 represents the fair value of financial instruments that are traded in active markets and is based on quoted market prices at the end of the reporting period.

The fair value of financial instruments that are not traded in an active market (level 2) is determined by using valuation techniques which include the present value of estimated future cash flows. These valuation techniques maximise the use of observable market data where it is available and rely as little as possible on entity specific estimates.

Level 3 primarily represents the Group's equity interest in Hino Motors Manufacturing Company SAS. Fair value is based on discounted free cash flows, using the projection of annual income and expenses mainly based on historical financial figures.

Derivative financial instruments are carried at their fair values. The fair value of forward foreign exchange contracts and foreign exchange swaps represents the difference between the value of the outstanding contracts at their contracted rates and a valuation calculated using the spot rates of exchange and prevailing forward interest rates at 30 June 2025.

The Group's derivative financial instruments comprise the following:

	Assets		Liabilities
	As at 30 Jun 2025	As at 31 December 2024	As at 30 Jun 2025	As at 31 December 2024
	£m	£m	£m	£m
Forward foreign exchange contracts	27	48	(33)	(47)
	27	48	(33)	(47)