Inchcape said Tuesday that group revenue for the first half rose 9% from a year earlier to £4.7 billion. The UK-based automotive distributor reported adjusted operating profit of £248 million for the period, while adjusted pretax profit amounted to £188 million.
Despite the revenue increase, adjusted operating profit was unchanged versus the prior year and the adjusted operating margin contracted to 5.3%, reflecting pressures in the Asia-Pacific region. Management said revenue gains were supported by new distribution agreements and recent acquisitions, with particularly strong contributions coming from the Americas and the Europe & Africa regions.
Gross profit was bolstered by expansion in aftersales operations and by finance and insurance services, areas the company highlighted as drivers of profitability within its core operations. At the same time, weaker results in Australia and across the wider Asia-Pacific footprint weighed on margins and overall profitability for the half.
To address underperformance in those markets, Inchcape has begun implementing cost-reduction measures and is exiting certain contracts that have not met expectations. Management indicated these steps are part of a targeted response to regional challenges.
The distributor also raised its share repurchase program to £250 million. Alongside the buyback announcement, management reiterated guidance for the full year 2026: an adjusted operating margin of approximately 6% and free cash flow conversion above 100%. The company expects its full-year performance to be skewed toward the second half, noting that seasonal patterns and planned management initiatives should help the Americas and Asia-Pacific regions improve as the year progresses.
Inchcape said it expects full-year adjusted earnings per share to increase by more than 10% for 2026, a pace that management says is consistent with its medium-term targets. The company did not provide further numerical detail beyond the guidance already disclosed for margins, cash conversion, and EPS growth expectations.
Key takeaways
- H1 revenue rose 9% to £4.7 billion; adjusted operating profit was £248 million and adjusted pretax profit was £188 million.
- Management increased the share buyback program to £250 million and expects adjusted EPS growth of more than 10% for 2026.
- Margins were pressured by Australia and the Asia-Pacific region, prompting cost cuts and contract exits; full-year adjusted operating margin is projected at about 6% with free cash flow conversion above 100%.