AKW Group saw its annual pre-tax profit climb by more than 60%, despite a £600,000 write off, after it delivered better-than-expected sales at its transport, warehousing and contract packaging businesses.
According to the group’s latest annual results to 30 June 2016, pre-tax profit rose to £1.5m (2015: £950,146) with turnover up 21.9% in the period to £24.6m (2015: £20.2m).
The group is the parent company of AKW Global Logistics, created after the merger of AK Worthington and Global Logistics (UK) in December 2014.
It shouldered a bad debt of £600,000 for a non-recoverable loan to Global Logistics Central in the period, its accounts show.
Despite this, the operator said new sales had “exceeded expectations” with a “robust” pipeline of work in its UK transport, warehouse and contract packing businesses.
Profits were also boosted by “tight cost control and operational efficiencies” at its transport business and its expanded contract packing business. profits.
The group said it is also planning to invest in its fleet with a strategy of replacing its vehicles every two years and investing in greener vehicles. It will also invest “significantly” in new technology, computer systems and fleet management systems.
AKW Group Logistics operates 90 trucks and 125 trailers and has 210,000ft² of transit warehousing and 500,000ft² of bonded, racked capacity available. It also offers contract packaging services.
The group moved into a new 12-acre site last year in Alba Way, Manchester, purchased in 2014, which features cross-docking, drive-through warehousing and parking for more than 100 trailers.
The move saw the group sell part of its former operating site at Westbrook Road in Manchester with the remainder classed as investment property, giving the group a fair value gain of £459,000.
Looking to the future, the directors said they were expecting 2016/17 to be “an excellent trading year, better than 2015/16”.
However they warned the shortage of HGV drivers is expected to result in wage and salary increases which, along with rising occupancy costs, will put pressure on the group’s operational costs.
Commenting on the results MD Julian Richards said: “It is a testament to the leadership and management teams of the AKW Group that, despite a testing period of change for the group as a whole, such significant progress has been made and that the business was able to deliver a healthy profit.
"Plans for 2017 are in action and we look forward to watching the future unfold.”
