Fergusons Transport said increasing interest charges and rising inflation took their toll on the business last year, after pre-tax profits fell by almost two-thirds to £172,000.

The Cramlington haulage and warehousing company said these pressures came at a time when customers were “not receptive” to the passing on of costs and despite it taking steps to reduce the impact, profits slid from £477,000 in the previous year.

However, it added that the board believed its results for the year ending 30 September 2023 were satisfactory and that the situation appeared to have stabilised.

Turnover during the period rose by £1.3m to £25.7m with its haulage operations accounting for the majority of this (£19.1m) followed by warehousing (£4.7m) and then fuel sales and other recharges (£2m).

Fergusons said gross margins on both sides of its business were affected by increases in interest rate charges and inflationary cost pressures, with haulage margins reducing to 14.7% from 15.6% and warehousing seeing gross margins falling to 27.7% from 32.2%.

“Currently, as inflationary pressures have eased and the Bank of England predicting a lowering of interest rates over the year, the pressures that businesses were feeling because of these issues should enable us to stabilise our costs,” it said in a review of the business.

“Whilst the last two years have seen a significant increase in rates, these now appear to have stabilised and are forecast to reduce in the near future.”

Staff numbers increased to 275 during the year, up from 264 in 2022.

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