Contract changes and one-off project costs contributed to Gist’s annual profit plunging by more than half last year, according to the firm’s latest results.

Whilst the food, networking and contracts logistics business saw turnover rise 4.8% to £437.3m (2016: £416.6m) in the year to 31 December 2017; its pre-tax profit fell 50% to £8.8m (2016: £17.7m).

In its strategic report to the accounts, the  company, which counts M&S, EAT and Starbucks among its clients, attributed the downward profit spiral to “contract changes” in its chilled and food services division and to “one-off business project costs”.

The report said the firm had invested heavily for growth in 2017 opening several new sites, winning some “exciting new customers”, and launching an organisational restructuring to drive greater efficiencies. It added that its focus this year (2018) would be consolidating these changes to drive growth.

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A spokeswoman for Gist told MT that the firm's 2017 profit had been affected by “significant investment” in the firm’s network last year.

This saw the company open a new depot in Motherwell, which is twice the size of the depot it replaced in Belshill. It also opened a new facility in Chesterfield, six times the capacity of the depot it replaced in Sheffield.

She said Gist has won “some significant contracts” this year in the chilled food and horticultural sector and added that the company planned to expand the Chesterfield site “as we win more business in the Midlands area”.

In July Gist’s parent company Linde announced it had dropped sales negotiations with potential buyers for Gist adding “a sale is no longer deemed to be highly probable”.

The sale had been prompted by plans by the German gas giant to divest itself of non-core businesses. Linde is currently merging with Praxair.

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