Motorpoint Group (LON:MOTR) reported record retail volumes and a sharp increase in profit for its 2026 financial year, with management saying data-led pricing, improved vehicle supply and operational efficiency helped the used-car retailer expand margins while growing sales.
Chief Executive Officer Mark Carpenter told investors that Motorpoint sold just under 65,000 retail units during the year, calling it a record performance and noting that the company had finally moved beyond its prior post-COVID volume peak after several years of supply disruption.
The company said its “metal margin” — the difference between what it pays for a vehicle and what it sells it for — rose 8% to £1,075, which Carpenter described as a record level. Profit before tax increased 83% to £7.5 million, while EBITDA rose 15%. Return on capital employed improved to 67%, from 47% a year earlier, according to Chief Financial Officer Chris Morgan.
Data-led pricing and AI tools support margins
Motorpoint’s management repeatedly pointed to technology, data and artificial intelligence as key drivers of the company’s performance. Carpenter said the business has shifted away from manual decisions toward automated, data-led processes for purchasing, pricing and allocating vehicles across its store network.
“The decisions are very much formulaic. They are not emotion driven or opinion related,” Carpenter said, adding that the company uses algorithms to determine where vehicles should be placed based on demand indicators, website activity and sales performance.
The company also highlighted its use of AI assistants in the sales process. Carpenter said an AI tool called Lily follows up with customers after salespeople have closed a lead, and that the tool sold around 900 cars during the year. He described those sales as “genuinely incremental.” Motorpoint has also introduced Ava, an “Automated Vehicle Assistant” on its website, to help customers research vehicles and finance options.
Carpenter said these tools are intended to improve productivity and help customers arrive at a buying decision more prepared, while still involving a salesperson before an order is placed.
Market share remains small despite gains
Motorpoint said it continues to see significant room for expansion in the UK used-car market. Carpenter said roughly 90% of the company’s sales are vehicles under six years old, and within that segment Motorpoint has a 2.5% market share. In the broader 0-to-10-year-old market, its share is below 2%.
The company currently operates in 21 markets and is preparing to open its 22nd market in Leeds next month. Carpenter said Motorpoint has strong market share within a 30-minute drive time of its physical locations and typically reaches about 5% share quickly after opening in a new market, with a longer-term target of about 10% in the markets where it operates.
Management said current-year trading has started strongly. Carpenter said sales were up 15% in the first two months of the new financial year and that the company believes it has continued to take share, though market data was not yet available.
Costs, supply and cash allocation
Morgan said gross profit grew 9% during the year, while operating expenses increased 4%, despite pressures from wage inflation and higher National Insurance costs. He said the company’s operating leverage means that keeping gross profit growth ahead of cost growth can drive higher operating profit, profit before tax and earnings per share.
Marketing efficiency also improved, according to Morgan. He said Motorpoint spent about £10.5 million on marketing in each of the last two years, but customer acquisition cost fell to £160 per unit as the company became more targeted in its channel spending.
Motorpoint said vehicle supply has returned to levels closer to pre-COVID conditions. The company acquired 46,000 cars from customers through part exchange or its Sell Your Car channel, and management said buying directly from consumers improves profitability by avoiding intermediary costs. Carpenter said Sell Your Car is running at more than 200 purchases per week since year-end and that the company expects more than 12,000 consumer purchases this year.
The company has also secured an additional £10 million revolving credit facility to support property expansion. Management said Motorpoint has acquired or is close to acquiring several larger sites and may use sale-and-leaseback transactions to return capital to the business after development.
On shareholder returns, Carpenter said the company has generated about £13 million in profit before tax over recent years and distributed £12 million to shareholders through dividends and buybacks. Morgan said Motorpoint returned £7 million to shareholders during the year, while Carpenter indicated that buybacks remain the preferred route for excess cash at current share price levels.
Customer and employee metrics remain a focus
Carpenter said customer satisfaction remains central to Motorpoint’s strategy, citing a net promoter score of 84. He said repeat and recommendation from existing customers are the company’s most effective form of marketing.
The company also emphasized employee engagement. Carpenter said Motorpoint was recognized in The Sunday Times list for 2026 based on employee surveys. He added that 88% of managers have been promoted from within, which he said supports the company’s culture.
Outlook: management optimistic, but financing costs a risk
Looking ahead, Carpenter said Motorpoint is optimistic about the current year, citing strong trading in April and May, stable metal margins and healthier vehicle supply. He said the company has not yet seen a negative consumer impact from the Middle East conflict, though Morgan and Carpenter both pointed to financing costs as a potential pressure.
Carpenter said the cost of money has risen following the Iran conflict, leading Motorpoint to increase the APR charged to customers. He said the higher rate could dampen demand over the next 7 to 30 days, though he added that the company had not yet seen a slowdown.
Management also said electric vehicles are becoming a larger part of the sales mix. Morgan said EVs represented 6.6% of sales in fiscal 2026, up from 2.8% the previous year, and were running at about 10% in the first two months of fiscal 2027.
Carpenter closed the presentation by saying Motorpoint expects to continue growing profitability through technology, data-led decision-making and expansion into new UK markets.
About Motorpoint Group (LON:MOTR)
Motorpoint is the UK’s leading independent E-commerce led omnichannel vehicle retailer, focused on giving retail and trade customers the easiest, most affordable and seamless way of buying, selling and financing their car whether online, in store or a combination of both. Through its leading B2C platform Motorpoint.co.uk and UK network of 20 sales and collection stores, the Group provides an unrivalled offering in the nearly new and used car market, where consumers can effortlessly browse, buy or finance their next car and collect or have it delivered directly to their homes.
