Circle Express said it was in a strong position to trade profitably after business slowed down last year due to the country’s lockdowns.

The express delivery company said new contracts in its distribution and warehousing divisions meant that its results would be “greatly enhanced” in 2022.

The company responded following publication of its latest financial results for the year ending 31 March 2020, which showed that despite an increase in turnover to £29.8m (£28.9m), it made a pre-tax loss of almost £2m during the period (£145,000).

Circle Express said the results reflected its reorganisation projects, which led to increases in subcontractor and warehouse agency costs.

It added that while the financial position had deteriorated during the financial year, revised management structures were now in place and it had implemented cost saving initiatives.

The first quarter of its latest financial year saw a significant reduction in activity and Circle Express said it had relied on the government’s job retention scheme to support the business.

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But Sam Sharma, global chief executive of Circle’s ultimate owners, Rico Group, told that the future looked more promising.

He said: “Circle has balanced the business slow down by utilisation of the furlough scheme to allow the business to return to an EBITDA positive position from July 20 when the lockdown was lifted.

“The subsequent national lockdown - pre-Christmas - has resulted in harder trading conditions; however, as the country starts to open up from March 21 the business is in a strong position to trade profitably going forward.

“The results will be greatly enhanced in FY22 as we have won several major new contracts across distribution and warehousing.”

Sharma said Circle Express had implemented tracking and trace technology for parcels, as well as vehicle tracking software and he added: “We have further bolstered the senior management team with a new head of sales and a northern regional director.”