Automotive Holdings Group Ltd shares plummet on trading update

A trading update out of diversified automotive retail and logistics group Automotive Holdings Group Ltd (ASX: AHG) signals continued headwinds in a “challenging” automotive retail segment as the company battles regulatory changes affecting finance and insurance – and investors have reacted in kind.

AHG has forecast a full year operating NPAT of around $75 million, with the sale of its refrigerated logistics division affecting trading and Western Australian private buyer recovery slower than expected.

Shares in AHG were down almost 11% to $3.04 at the time of writing.

AHG managing director John McConnell said an uplift in margins is expected for the second-half from franchised dealerships and used car businesses that have been below expectations of late while the company’s truck division remains strong with management focused on cost control and revenue growth.

Elsewhere in the automotive space shares in four-wheel drive accessory company ARB Corporation Limited (ASX: ARB) are up 0.3% to $21.44 at the time of writing after a market update this month revealed the company was well-positioned to continue growth despite “severe instability” in the sector.

Shares in related stocks Autosports Group Ltd (ASX: ASG) and Caltex Australia Limited (ASX: CTX) held strong today at $1.79 and $30.86 respectively.

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