Aramis group: Sales of reconditioned used cars are falling at Aramis

(BFM Bourse) – The specialist in the online sale of used cars has published a turnover growth of 6.8% in the third quarter of its 2022-2023 financial year. But restated for perimeter effects, its revenues have actually fallen.

Aramis Group continues to record significant stock market volatility with each of its publications. When its half-year results were published in May, its stock had soared.

This time, on the contrary, investors are sanctioning the publication of activity for its third quarter of the 2022-2023 financial year, which will end at the end of next September. The Aramis Group share thus lost 6.5% to 5.31 euros on the Paris Stock Exchange around 11:30 a.m.

Over the period from April to the end of June, the company’s revenues amounted to 489 million euros, up 6.8% in published data.

>> Access our exclusive graphic analyses, and enter into the confidence of the Trading Portfolio

Lower volumes of reconditioned cars

This performance is nevertheless supported by scope effects. Sales to individuals, which represent 84% of turnover, rose by 10.1% over one year to 411 million euros. But by restating the group’s recent acquisitions in Germany and Italy, the turnover of this segment turns out to be “in a slight decline”, indicates the group without specifying the exact extent.

Revenue from refurbished cars alone fell 5.1% year-on-year, excluding scope effects, to 311 million euros (350 million euros including the impact of acquisitions). This shows “contrasting performances depending on the country, a consequence of both the underlying dynamics of the different markets and the operational decisions taken locally by Aramis Group”, explains the company. In volume terms, the number of reconditioned vehicles sold fell by 6.6% over one year, excluding scope effects.

Sales of pre-registered cars (also called “zero kilometer vehicles”, almost new cars with a mileage of less than 50 km, which have only been driven for logistical reasons) increased by 33.7% to 66.1 million euros.

The B2B segment, i.e. sales to professional customers, which represent 11% of revenues, fell by 14.7% to 52.1 million euros. Finally, services (5% of turnover) rose by 10% over one year to 25.6 million euros.

Inflation weighs on demand

The outlook communicated by the company may also raise eyebrows among investors. Aramis confirmed its objectives for the whole of the 2022-2023 financial year, namely positive organic growth in its volumes of reconditioned vehicles sold to individuals, as well as a positive adjusted gross operating profit (EBITDA).

However, the company notes that demand “on all European automotive markets” is “measured”, “in an inflationary context which has led households to manage more constrained budgets for several quarters”. “Consequently, registrations of used vehicles less than 8 years old continue to register a decline in several geographies of the group,” adds Aramis.

In addition, the average prices of second-hand vehicles sold to individuals “continue to decline gradually, reflecting the gradual rebalancing of the market”, continues Aramis Group.

It should be recalled that due to very strong tensions on the supply of new cars, due in particular to the semiconductor crisis, second-hand prices had risen sharply in 2021 and 2022.

Julien Marion – ©2023 BFM Bourse