Pinewood has revised its earnings forecast amid plans for US expansion through a joint venture.
- The company, formerly known as Pendragon, anticipates £30m in earnings by FY27.
- A partnership with Lithia Motors aims to penetrate the challenging US market.
- Pinewood’s rebranding and strategic moves led to a stock rise of 1.4%.
- CEO Bill Berman highlights the importance of strategic partnerships for market entry.
Pinewood has recently adjusted its earnings guidance, projecting an increase from £27m to £30m by the financial year 2027. This revision reflects the company’s strategic moves towards substantial growth, particularly in the United States. At a capital markets event, Pinewood outlined its ambition for international expansion, emphasising the role of its rebranding to Pinewood.AI. This strategic rebranding aligns with its new focus as a pure play software-as-a-service (SaaS) provider.
The former Pendragon enterprise, now Pinewood, has embarked on forming a joint venture with US dealership conglomerate Lithia Motors. This partnership is pivotal as Lithia Motors, listed on the New York Stock Exchange, acquired former Pendragon dealership groups earlier this year, including notable names such as Stratstone and Evans Halshaw. By integrating Pinewood’s software solutions into its operations, Lithia aims to not only enhance its systems but also advocate for the software’s adoption among competing dealerships.
Bill Berman, Pinewood CEO, articulated the significance of this venture, stating the necessity of having a solid partner in such competitive markets, drawing parallels to establishing a foundation in new edifices. Berman stressed that without partnerships like that with Lithia, the journey into the US market would be arduous, necessitating extensive development and market penetration efforts.
Pinewood’s strategic actions have positively impacted its market performance. Shares in Pinewood have seen a 1.4% increase, reaching 340p following the market opening on Thursday. This is part of a larger trend, with shares climbing over 13% in the past week, buoyed by the announcement of a new five-year service contract with Marshall Motor Group. This contract underscores Pinewood’s strengthening market position as it prepares for its US expansion.
Pinewood’s calculated strategic partnerships and revised earnings forecast highlight its commitment to a successful US market entry.
