Four years after the merger of Home Delivery Network and DHL Express’s domestic business, Yodel yesterday suggested that it made a loss during its recently completed financial year, although it seems confident a return to the black and its first ever profit is now in sight beyond this.
Yodel said its EBITDA (earnings before interest, tax, depreciation, amortisation) improved by over £70m in the year to 30 June 2014. While a significant improvement, it didn't provide detail in regards profit but given it made a pre-tax loss of £98m for the year to 30 June 2013 - it's last full published accounts - the smart money suggests its likely to have remained in the red in the twelve months to 30 June 2014, which we'll have confirmed for sure in the coming months.
Both turnover and losses at Yodel have fluctuated quite a bit in its four year history (since its creation with the merger of DHL Express Domestic UK and HDNL). In its first full year of trading following the merger in January 2010, Yodel posted a pre-tax loss of £131.8m on £723.5m turnover for the year ended 30 June 2011.
It halved its losses in the 2011/12 financial year, taking the figure down to £66.9m on £535.1m of turnover. This was the year it focused on rationalising its network, closing down and opening new service centres in a bid to make the merged network more efficient.
Both turnover and losses continued to worsen in 2012/13, despite new senior management and a focus on improving its customer service levels. Turnover fell to £379m, and its pre-tax loss increased to £98.2m.
As said, although figures for the 2013/14 year have not yet been released, Yodel seems more upbeat about its financial prospects for this year. It said it has made “significant progress” in its financial turnaround, focusing specifically on improving customer experience and the quality of the service it provides.
Executive chairman Dick Stead claimed that Yodel’s management and shareholders are committed to developing a business with a “profitable and long-term future”.