A year after acquiring a 90% controlling stake in Europa Worldwide Logistics, MD Andrew Baxter said the firm is on track to hit its growth targets, although that will come with a short-term dip in profit.
Baxter told MT: “It is our objective to be the number one groupage operator in the UK. That will be achieved, but there is a question of how long it will take to achieve that. Our growth will be held up because we are limited by what we can take on in our premises.”
Construction work has begun on its 262,500ft² site at Prologis Park in Littlebrook, Dartford, set to open in May 2015. The site will become its southern hub, replacing its head office in nearby Erith.
Baxter said that because of the constraints at its facility in Erith it had been put in a position “where we were having to turn away some large customers and partners who want to work with us”.
In its financial year to 31 December 2013 (during which Baxter bought out the business in August), turnover at Europa rose to £73.2m, from £72.7m in the previous financial year, while pre-tax profit fell 87% from £411,825 to £52,721.
Baxter said the company had made provisions for dilapidations on existing properties, and was continuing to invest in new sites, staff and IT infrastructure, a move that would reduce profit in the short term.
“Our objectives will see us have a modest level of profit, but in 2016/17 we will see an impact [of the investments] and a higher level of profit than the company has had in the past,” he said, adding that turnover growth in 2014/15 would be much larger.
He also revealed that he had invested approximately half of the money he received as a result of the Baxter family selling RH Freight to Kuehne + Nagel in March 2011 into Europa.
