Inchcape plc

Good morning everyone and thank you for joining us. I'm here with our CFO Adrian Lewis and our head of investor relations Rob Gerner. I'll give an overview of our strategic progress and operational performance in the quarter and then hand over to Adrian for more detail on the performance across the regions and the outlook which remains unchanged. We'll then take your questions. In a fast moving global automotive environment, Inchcape delivered a resilient performance in the third quarter with revenue growth of 2% in constant currency and we are reiterating our outlook for the year. This reflects the underlying strength, scale and diversification of our business as well as the consistently excellent operational execution by our teams. Our performance also highlights the ongoing strategic progress we have made with recently won distribution contracts supporting the top line performance amid a mixed market backdrop. This progress has continued in 2024 with nine distribution contracts won so far this year, including a further five in the second half. These included two in Australia, Deepal, a Chang'an brand and Photon, as well as three contracts in the Americas, Harley-Davidson in Chile, Peugeot in the Caribbean and Great Wall Motors in Colombia. With the disposal of our UK retail business during the period and a healthy pipeline of bolt-on acquisitions, Inchcape is well placed to further consolidate our position as the world's leading pure play automotive distributor by leveraging our differentiated technology capabilities to support our OEM partners, by continuing to build market share in existing markets, by expanding into new markets and by further developing our OEM partner portfolio. With that, I'll now hand over to Adrian. Thank

you, Duncan, and good morning, everyone. During the period, the group generated £2.2 billion of revenue, up 2% in constant currency, with organic revenue down 1% and a 3% contribution from acquisitions. With translational currency headwinds of 7%, reported revenue was down 5%. Looking at the key trends across our regions, in the Americas, we continued to see markets like Chile and Colombia stabilising. This helped to deliver an improved organic revenue performance in the quarter compared to the first half. In APAC, there were some strong performances in certain markets, in particular Singapore, where we are seeing growth in line with the market, Hong Kong, where we achieved market share gains and a contribution from our acquisitions. However, we saw some market headwinds more recently in Australia, where consumer confidence has weakened. Europe performs strongly, supported by a continuing order bank unwind in certain markets in Europe, including Greece. And we have now seen three consecutive quarters of new order growth in Europe, including Belgium, Romania and Bulgaria, partly from the performance of new contracts won in 2022. And this will help to offset the expected normalisation of growth in the region in the future. Africa, despite currency devaluation in Ethiopia, has seen a stable market and resilient revenues. Let me remind you that our balance sheet remains in good shape following disposal of our UK retail business for an equity value of £346 million in the quarter. And in addition, we maintain good discipline on working capital, which has seen our inventory fall below levels seen at the start of the year. We maintain a disciplined approach to capital allocation, and this is evidenced by the progress made with our £150 million share buyback programme initiated on the 31st of July. And we have already acquired around £83 million in shares, with the programme expected to complete during the first quarter of next year. Acquisitions are a critical part of our growth strategy, and we remain disciplined on valuation. And as Duncan has mentioned, we have a healthy pipeline of bolt on acquisitions. And finally, on to Outlook, we continue to expect to deliver moderated growth for the group for 2024 at constant currency, supported by our ongoing discipline on cost management. Reported profits for this year will be impacted by the translational foreign exchange headwinds during the second half of the year. In particular, the Ethiopian BIR has devalued by around 60% since the 28th of July, when the government unveiled its plan to transition to an exchange based currency regime. In 2023, our Ethiopian business was an immaterial contributor to growth for the group and a low single digit proportion of group PBT, which equated to approximately £23 million. And in considering the full year impact of the currency devaluation in that market, it is worth noting that in line with hyperinflation accounting principles, the income statement for Ethiopia is translated at the closing currency rate rather than the average rate across the period, as you would do under normal accounting principles. Turning to the medium term outlook for Inchcape, we remain confident about returning to higher levels of growth whilst driving returns for our shareholders. This will be driven by a highly cash generative earnings model, the continued diversification and scale of our business, further acquisitions and contract wins, supported by an anticipated recovery across a number of markets. So now let's take your questions and if you could limit your questions to two each please, that would be greatly appreciated. Sergey, over to you.

Thank you so much. Ladies and gentlemen, if you wish to ask a question at this time, please signal by pressing star one on your telephone keypad. If you wish to cancel your request, please press star two and please make sure the mute function on your phone is switched off to allow your signal to reach our equipment. Again, it is star one to ask a question. The first question comes from Akshad Mathur from JPMorgan. Please go ahead.