Shares of Lookers PLC (LON: LOOK) exploded 122.6% higher after revealing that it made an underlying loss of £36.1 million in H1 2020 as its shares were readmitted for trading on the London Stock Exchange (LSE) earlier today.
Today’s spike was largely driven by the pent-up demand for Lookers shares which were suspended from trading on the LSE on 30th June 2020 up to now. The company also reported a statutory loss of £50 million for H1 2020, which is a far cry from the £22 million profit recorded in a similar period in 2019.
The company had a rough time in 2020 as it struggled to restructure its business and close some of its unprofitable outlets. Lookers was also hit by allegations of internal fraud and the firm was investigated by the UK’s Financial Conduct Authority (FCA) leading to the delisting of its shares.
The UK car retailer revealed that trading in H2 2020 had improved significantly and that this would have a positive impact on its full-year results by offsetting the losses made in H1. The company also managed to reduce its net debt to about £45 million as at 31st December 2020 compared to £59.5 million in net debt at the end of 2019.
Mark Raban, Lookers’ CEO, said: “2020 was a challenging year for Lookers, managing the impact of the COVID-19 pandemic and a number of legacy issues facing the Group, which required significant action to restructure and improve the business for the long term.
Adding:
“Going into 2021 there remains a high level of uncertainty in the wider environment, but we are confident that the Group is now much better positioned for the longer term and can capitalise on the various opportunities ahead, not least in electrification and digital developments.
Lookers share price
Lookers shares spiked 122.61% higher to trade at 46.75p after resuming trading today having risen from its 30 June 2020 closing price of 21p.