Motorpoint Group PLC (LSE:MOTR, OTC:MTPTF) shares skidded 6% to a new all-time low after the company swung to a first-half loss and reported a rapid fall in used car values in the early weeks of the second half.
However, the car dealership group said it had seen a strong improvement in cash generation after taking actions to cut costs.
Revenue came to £607.2 million for the six months to 30 September, down 23% on a year ago, as retail volumes slumped 18.4% and wholesale volumes 22.4%, with online sales down 36%.
Underlying operating profit fell 73% to £1.6 million and at the statutory level it swung to a £3.7 million loss before tax from a £3 million profit a year earlier, partly due to the increase in interest payments and restructuring costs.
Analysts said the results were in line with previous guidance.
The company said it had been successful in "right-sizing" the business with material reductions in staffing and more efficient marketing, which led to one-off costs.
Net cash more than doubled to £11.2 million, despite lower profitability, which it said reflected working capital management and reduced capital investment. Its bank facility was undrawn at the half year.
Chief executive Mark Carpenter said: "The rapid fall in used car values since the period end is unquestionably a near term challenge, however it also provides reassuring signs of supply finally beginning to improve in the nearly new market that we have dominated in the past.
"I believe next year will be a key turning point for the market and I look to the future with confidence."
House broker Shore Capital said: "The results confirm that decisive actions have been taken to right-size the business, with a small positive EBIT and a focus on cash conservation (£11.2 million net cash) reported in what is a tough UK market.
"We welcome our reiteration of FY24F expectations, which implies improved profitability for the remainder of the year, and management's confidence in the group strategy."
The shares were down 6% at 73p after an hour of trading, hitting a new low below 72p in early deals, more than halving over the past 12 months and down from highs around 350p in the used car boom in late 2021.