Automotive Holdings Group Ltd (ASX: AHG) released an ASX trading update for its 2018 financial year.
Automotive Holdings Group (“AHG”) is the name behind popular transport brands like Rand and Harris Refrigerated Transport. It is also one of the country’s largest car and truck dealership owners.
In an update to the ASX this morning, AHG said automotive retail margins are challenging, and the ongoing impact of regulatory changes isn’t helping. Meanwhile, a WA recovery in private sales is slower than expected.
The result is that AHG expects to report a full-year operating profit of around $75 million.
“Our retail automotive business is adjusting to the changes to finance and insurance sales more slowly than we would have liked and that’s apparent across the sector,” CEO John McConnell said.
In November, AHG announced its decision to sell its refrigerated transport business for $400 million to China’s HNA International.
“The business performed ahead of the previous corresponding period in the first half however second‐half trading has been impacted by the sale process and the relatively long lead time to completion,” McConnell noted.
AHG said it expects to complete the deal on or before June 30. However, a transaction remains subject to an approval from Australia’s Foreign Investment Review Board (FIRB).
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