Despite its shares remaining suspended, parcel delivery specialist DX Group reported today that trading in the six months to 1 January 2022 was “in line with the board’s expectations”.
In a trading update the company said that it had weathered a “tight labour market and customers’ supply chain disruptions” to deliver a rise of around 11% in group revenue compared to the first half of the previous financial year, with trading momentum continuing into the third quarter of this financial year.
DX saw its shares suspended on 4 January this year, following an announcement by DX in November last year that its audit and risk committee had raised a corporate governance inquiry relating to an internal investigation, which started during the 2021 financial year.
The trading update said that DX Freight had continued to improve its volumes and margins compared to the same period last year, whilst volumes at DX Express remained consistent with the first half of last year, with the product mix showing a “slight shift” back towards the division’s historic B2B weighting rather than B2C, following the easing of coronavirus restrictions.
The update added: “Net new business at both divisions continued to be robust and the pipeline of new business opportunities remains extremely healthy.”
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DX Group is also continuing with its network expansion, noting that it had made good progress in the first half.
It added: “Following the opening of four new depots and the expansion of a further depot in the first half, two new depots were opened in early January 2022, at Bodmin and Coventry, in line with plans. They will support productivity improvement at DX Freight.
The company is also planning to open an additional five depots in the second half of the financial year, to service “new growth opportunities and the pipeline of new business” at both DX Freight and DX Express.
The report concluded that the group’s financial position “remains strong” with net cash at the period end totalling £14.5m (2 January 2021: £14.1m) with the £20m invoice discounting facility undrawn, which it said gives the group “significant levels of headroom.”
It added that the corporate governance inquiry announced on 25 November 2021, which led to its shares being suspended, is continuing, adding that the company “will provide a further update in due course.”
