Northgate has warned that its profits may fall by half this

The light commercial vehicle rental company, which has
operations both in the UK and in Spain, announced that underlying
pre-tax profits fell by 40 percent to £26.5 million (€30.2 million)
in the six months to October 31, compared with £44.2 million (€50.3
million) for the same period one year ago

The company explained that the drop was mainly the result of
significant reduced residual values, lower utilisation and
increased interest costs.

Northgate’s chairman Philip Rogerson said: “The deteriorating
economic conditions in both the UK and Spain have impacted
significantly on the results for the period, particularly in
relation to the values achieved in disposing of used vehicles.”

He added that the company was adopting strategies to reduce the
effects of “external factors on the company’s profitability”,
including an efficient fleet management and targeted cost