ARR Craib said that its customer retention has been excellent, despite the fall in the price of oil that led to a significant downturn among its core oil and gas customers resulting in a 9% fall in turnover in its most recent financial year.
For the year-ending 31 March 2016 turnover at Aberdeen-based ARR Craib Transport fell to £43.39m, from £48.15m in the previous financial year, while pre-tax profit fell from £1.38m to £1.04m.
In the annual report filed at Companies House, directors at the Scottish firm said that the year had been “strong and encouraging” given the “continued significant downturn” suffered by the UK oil and gas industry since mid-2014 (which contained a noticeable and tangible further downturn in the third quarter of 2015).
It said that the low price of oil to an average of $30 a barrel in the financial year (compared to a high of $110 two financial years previously) had seen its customers focus on all cost areas and “in several cases” ARR Craib had had to re-tender or renegotiate its contracts and agreements.
During this period the ARR Craib board said that the 9% reduction in turnover was successful, given a market average in double-digits, its customer retention had been “excellent” and it had even won new contracts during the period.
Cost reduction measures resulting from the oil and gas market recession continued throughout 2016 and its next financial year will see further reductions in staff costs, team reorganisations and a review of its processes and costs.
Outside of oil and gas, the Palletline member said its operations in Aberdeen, Cumbernauld and Stockton had performed well with “strong growth in a highly competitive market” while its food and drink business in the north-east and north of Scotland had seen market share increases.
During the year ARR Craib said it had spent approximately £1m on upgrading its fleet, through hire purchase and operating lease arrangements – to ensure its fleet age profile kept young.
