The insolvency of a major mining customer cost Hargreaves Services more than £8m last year, the group revealed today.
In its interim results, Hargreaves Services, whose distribution and services division includes Hargreaves Logistics and Hargreaves Waste Services, detailed the impact of Wolf Minerals' insolvency.
The resulting loss of the contract at the Hemerden tungsten mine in Devon last October saw Hargreaves record an exceptional charge of £8.1m in the six months to 30 November 2018.
This comprised a £5.1m write down of trade debt and £3m of redundancy and other associated costs.
Hargreaves Services, which recently sold off Halcyon Tankers to a team of its former directors, recorded a loss of £6m in the six-month period compared with a loss of £1.6m a year ago.
Group turnover climbed 12% to £167.9m (2017: £150.3m). This includes the group’s property business.
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Hargreaves Services' distribution and services division recorded a turnover of £152.5m (2017: £146.8m) but an operating loss of £3.8m (2017: £100,000 profit).
“Whilst it is pleasing to report growth in revenue and margins from the distribution and services business, which is proving to be a progressive source of underlying operating profit [£6.4m], the group suffered a substantial loss following the failure of its tungsten mining customer, Wolf Minerals.
“Despite this setback, the board is confident that the distribution and services business will continue to provide the group with near-term growth and cash generation whilst the property business becomes established to realise medium and longer term shareholder value,” said company chairman Roger McDowell.
An interim dividend of 2.70 per share will be paid on 8 April.
