NORTHGATE Motor Holdings parent company Goode Durrant has revealed a slump in half-year profits caused by the falling value of second-hand vehicles. Despite a £28 million increase in turnover, Northgate was unable to totally absorb the dramatic fall in residual values across the industry leaving the company with a half-year losses year-on-year amounting to £900,000 for six months to the end of October.

Pre-tax profits were down to £15.1 million from £16 million, despite revenues up to £116 million from £88.1 million for the same period in 1997. Company chairman Michael Waring said the company expected a slowing economy this year to see businesses extend their vehicle replacement periods, helping the hire firm's balance sheet through increased income on each vehicle in the fleet.