Challenging market puts Lloyd Fraser Holdings to the test

Lloyd Fraser Holdings has delivered a mixed performance in what it described as a “very challenging” and price driven market.

Reporting its annual results for the twelve months to 28 February 2018, the Rugby-based company revealed that its operating profit had risen by almost two thirds whilst its turnover had fallen by 26% in the period.

The company’s turnover was £40.9m, a pro-rata fall of 26% when compared to turnover in the previous 18 month period, which stood at £83m.

Conversely, operating profit rose in the period by 60%, once exceptional costs were removed. The strategic report to the accounts states: “Operating profit, excluding exceptional administration costs, was £1.1m in the current year, compared with £1m, excluding pension scheme adjustments, in the prior period.”

Pre-tax profit was reported at £606,389 in the twelve months, down from £3.7m in the previous 18 month period.

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The results also revealed that whilst the lion’s share of turnover was in the UK (£39.7m), turnover from the rest of Europe rose to £1m from £692,745 in the previous 18 months.

Lloyd Fraser Holdings operates seven subsidiaries which includes Lloyd Fraser Bulk Liquids, Lloyd Fraser Dairy Services, Lloyd Fraser contracts, Lloyd Fraser Logistics, Lloyd Fraser Distribution, Lloyd Fraser Primary Logistics and The Mercury Recruitment Network.

The group operates a fleet of 500 vehicles across 20 locations and employs over 512 staff, down from 650 in the previous period.

The group said it planned to continue to focus on its current sectors and develop value added services “to maintain long term client relationships”.

It added that whilst it could see no specific risks to the company, other than that of being in the third party logistics sector, the market’s continuing focus on price “creates obvious pressure on margins”.

On the upside the company said it was in a strong financial position, pointing to cash reserves of £3.4m - although down from £4.6m in the previous period - due to the repayment of finance lease liabilities.

Lloyd Fraser director Keith Spencer told MT he was happy with the firm’s performance this year. “We are winning new business in all our sectors and confident in the future,” he added.