Motorpoint interim results: 80% profit growth, tech-first strategy paying off
Motorpoint’s half-year numbers show a business leaning into data and technology – and it’s working. Revenue rose 15.0% to £647.7m, profit before tax jumped 80.0% to £3.6m, and EBITDA (earnings before interest, tax, depreciation and amortisation) increased 22.5% to £13.6m for the six months to 30 September 2025. In a used car market that only crept forward, that’s clear outperformance.
The Board has also resumed shareholder returns: an interim dividend of 1.0p is declared, alongside the completion of a £5.0m buyback in the period. Return on Capital Employed (ROCE – a measure of profit generated from the net assets employed) surged to 58.8% from 18.7%.
Key numbers investors will care about
| Metric | H1 FY26 | H1 FY25 | Change |
|---|---|---|---|
| Revenue | £647.7m | £563.1m | +15.0% |
| Gross profit | £49.5m | £44.7m | +10.7% |
| Operating expenditure | £41.0m | £38.6m | +6.2% |
| EBITDA | £13.6m | £11.1m | +22.5% |
| Profit before tax | £3.6m | £2.0m | +80.0% |
| Basic EPS | 3.2p | 1.7p | +88.2% |
| Dividend | 1.0p | Nil | n/a |
| ROCE | 58.8% | 18.7% | +4,010 bps |
| Net (debt)/cash | £(0.5)m | £11.2m | — |
Operational performance: volumes up, market share higher
Retail volumes rose 8.9% to 32.94k units and wholesale (Auction4Cars.com) grew 11.1% to 14.46k units. Total vehicles sold hit 47.40k, up 9.5%. Market share in 0-6 year-old cars improved to 2.50% (up 17 bps). The Net Promoter Score moved from 77 to 83 – a useful proxy that customers like the experience.
Retail gross profit per unit nudged up to £1,349 (from £1,317), helped by what the company calls “metal margins” – essentially the profit made on the car itself. Wholesale GPU was £351 (from £369), still healthy given volumes and mix.
Data, AI and omnichannel: why margins held up
Management has doubled down on a data-led buying and pricing model. That means quicker stock turns on the right cars, fewer over-aged vehicles, and pricing that flexes with demand. The use of AI is now embedded across customer interaction and pricing, including reactivating closed quotes and an AI discovery assistant due to roll out in H2 FY26.
In plain English: the tech stack is helping Motorpoint buy smarter and sell faster at competitive prices – crucial in a low-margin industry where cars depreciate daily.
Costs, financing and stock: the moving parts
- Operating costs rose 6.2% to £41.0m, reflecting a new store, wage and NI increases, and volume-driven headcount. The flip side: notable savings in energy and card fees.
- Finance expense increased to £4.9m (from £4.1m) due to higher stock levels, even as base rates eased slightly.
- Inventory increased to £186.9m (from £151.4m at 31 March 2025) and days in stock lengthened to 49 (from 41). Management has intentionally built stock ahead of a busy Q4.
- Stocking facilities of £165.0m are in place, with agreed seasonal uplifts taking available headroom to £205.0m in Q3 and Q4 – useful firepower for peak trading.
One to watch: while stocking up supports growth, it also raises interest costs and working capital needs. The improved ROCE suggests the economics remain attractive, but the discipline on days-in-stock needs to hold.
Supply channels and brand reach: broadening the funnel
- Direct-from-consumer purchases continue to ramp, with over 9,750 cars acquired in the period, up 14.7%.
- Fleet channel buying is improving as nearly-new supply loosens.
- Marketing is doing more with less. Customer acquisition cost per retail unit was steady at £149, while Motorpoint reports stronger Google visibility and lower lead costs year-on-year.
Collectively, this means more cars sourced at attractive prices and more shoppers funnelled into stores and online – the core ingredients for volume-led margin expansion.
Shareholder returns: dividend reinstated and buybacks completed
Motorpoint bought back and cancelled 3.0m shares for £5.0m during the half and has returned £10.9m to shareholders since March 2024 (including dividends). An interim dividend of 1.0p per share is declared, payable on 12 December 2025 to holders on 21 November 2025.
There’s a sensible capital allocation framework here: invest for organic growth first, then return excess cash via buybacks and dividends. Given the capital-light model, that’s a credible route to compounding returns if execution continues.
Regulatory backdrop: historic finance commissions
The Supreme Court dismissed bribery and fiduciary duty claims in August 2025 but upheld an “unfair relationship” finding on specific facts. The FCA’s consultation on a redress scheme (issued 7 October 2025) runs to December 2025. Motorpoint’s view is that automotive brokers are not liable and no provision is required.
My take: this is the main external swing factor. While Motorpoint sees no liability, the eventual FCA position is not final yet. Worth monitoring until the consultation concludes.
Current trading and outlook: momentum into H2
- October retail volumes up 8.1% with good profitability.
- “Metal” margins remain strong; used car prices stable.
- Stock levels increased ahead of the seasonally strong Q4.
- Management expects macro pressures to gradually ease and is accelerating strategic growth plans.
That reads as confident without being complacent. The Autumn Budget is flagged as a near-term watchpoint for consumer sentiment.
What this means for investors
Why the update is positive
- Clear market outperformance: volumes and market share up while the wider market barely grew.
- Margin resilience: higher retail GPU and tight cost control offset weak finance commission income.
- High ROCE and resumed cash returns: 58.8% ROCE, 1.0p interim dividend, and ongoing buyback discipline.
- Technology edge: data and AI are translating into real-world KPIs – faster buying, sharper pricing, higher conversions.
The caveats
- Working capital is doing more work: stock is higher and days in stock lengthened to 49, lifting finance costs.
- Regulatory uncertainty around historic finance commissions remains until the FCA consultation is finalised.
- Finance commission income is still subdued with interest rates relatively high.
Bottom line
Motorpoint has put points on the board: double-digit revenue growth, 80% PBT growth, stronger unit economics, and a high ROCE – all while returning cash to shareholders. The strategy to use data and AI to buy and sell better is clearly gaining traction, and the increased stocking capacity sets the business up for a robust Q4.
For me, it’s a constructive update with two things to track: how quickly days-in-stock normalise through the peak season, and the FCA’s final stance on historic finance commissions. Deliver on those, and the case for continued profitable growth – and further shareholder returns – strengthens.
