Macrae and Dick (M&D) said operating profits slid by 6% to £1.57million in 2013, with the north’s biggest car dealer blaming economic conditions and a squeeze on margins.
But the Inverness company also reported a near-40% increase in pre-tax profits to just over £1.6million, from £1.26million the year before, thanks to a fall in pension costs.
Turnover soared by 21% to £164million as the group “continued to increase market share and successfully retain existing customers”, M&D said in its latest annual accounts.
Last year’s large rise in turnover came as sales of new cars across the motor trade in Scotland returned to levels not seen since before the credit crunch.
According to M&D group managing director Andy Grzesinski, some of the rising demand was driven by an increase in personal contract purchases – where customers pay for the right to drive their new vehicle over a set period.
M&D’s accounts, just released by Companies House, show a 17.7% increase in new vehicle sales on a like-for-like basis last year, with sales of used stock ahead by 15%.
The firm, which has car showrooms in Inverness, Aberdeen, Elgin, Perth and Stirling, said its new vehicle sales were well above the Scottish average for last year, which was 12.5%.
It added: “£2.6million cash was generated from operations, of which £1.2million was spent on improvements to the Jaguar, Mazda and Toyota showrooms in Inverness along with the BMW and Mini showrooms in Stirling.
“The balance sheet remains very strong. The directors believe the group is well-positioned and intend to actively seek opportunities for investment within the retail motor trade.”
M&D has franchises for BMW, Ford, Honda, Jaguar, Land Rover, Mazda, Mini and Toyota.
It also supplies parts for all makes of cars, vans and light commercial vehicles.
The business, created in 1878 by Roderick Macrae of Beauly and William Dick of Redcastle, is controlled by chairman Francis Hamilton.
Its latest accounts show it employed 456 people, on average, during 2013. This was up from 426 the year before.