DRIVING GROWTH

We added carsales.com.au to the MT Income Portfolio yesterday. The business was in the news late last year, taking an impairment on its Stratton Finance business. The issues are structural, due to regulatory changes and will take some time to iron out. The impairment itself was immaterial.

Outside of Stratton, things are looking good for CAR. Their display (new car) business was under pressure last year as total sales volume dropped 3%, but as we noted in yesterday’s coverage of AP Eagers (following their upgrade) we wouldn’t be surprised to see both the property and car markets bottom and turn higher this year.

The highlights are the strong growth seen in the core (used car) and international businesses. When