European Motor Holdings generated a 7.2 percent return for the quarter on strong luxury-car sales.
The chain's luxury cars helped maintain profitability despite a weaker UK market. In its fiscal year ended February 28, European Motor's pre-tax profit was ahead of expectations at £15.8 million (currently E23.2 million), up 13 percent.
The company announced a £65 million acquisition of Smith Knight Fay, a premium-focused dealer group with Audi, Lexus, Mazda, Toyota and Volkswagen franchises. It operates 18 stores in northwest England.
The acquisition price represents over 9 times Smith Knight Fay's operating profit for 2004, but EMH expects the acquisition to soon boost earnings, especially as Volkswagen is launching a series of new models.
EMH's retail division holds 37 franchises, covering Audi, Bentley, BMW, Mini, Jaguar, Land Rover, Volkswagen and Volvo.
In June it announced the appointment of David Beck as a non-executive director. Beck was formerly at Quicks Group.
Inchcape gave shareholders a modest 0.4 percent return in the quarter. The world's largest independent automotive services company is insulated against the UK market downturn by its international operations, notably in Singapore, Hong Kong, Australia and New Zealand.
In the UK, Inchcape keeps expanding in premium-car retailing. It acquired six more Mercedes-Benz dealerships, giving it 14. It is the UK's largest independent Mercedes new-car retailer, with analysts estimating it now contributes about 8 percent of the brand's UK sales.
The group spent part of its £154 million cash hoard to buy back shares. It also appointed a new CEO - Andre Lacroix, 45, former head of Euro Disney. He succeeds Peter Johnson, who becomes chairman.
Total Shareholder Value Index
The Automotive News Europe/PricewaterhouseCoopers Shareholder Value Index for European automakers, suppliers and retailers reflects investor returns for publicly traded companies.
The index measures the growth in value of an investment by including capital gains, share buybacks and dividends, and assumes that all cash distributions are reinvested.
The three categories surveyed include vehicle manufacturers headquartered in Europe; European suppliers with annual sales more than E100 million, of which more than 50 percent is in the automotive sector; and European car retail companies with sales more than E250 million. The returns have been adjusted for currency movements.The indices are weighted by market capitalization. Companies with larger capitalization - the value of a share price multiplied by the number of shares outstanding - have a greater impact on the index.