Meachers Global Logistics has posted an increase in turnover and profits, but said rising costs and a shortage of drivers is proving challenging.

The Southampton-based logistics company increased group turnover by 17.2% to £30.6m in the year ending 31 May 2019.

Pre-tax profit increased by 16.5% to £2.2m.

In its review of the business, the company said the “significant increase in activity was achieved with an increased number of staff and agency labour".

It added: “Employee numbers increased by 4% and the group cost of agency staff increased by 44.9% on the prior year, continuing to highlight the difficult market conditions being experienced in recruiting permanent HGV drivers.”

Meachers expects to develop the business through organic growth and add additional contracted business within its core activities of warehousing, freight forwarding and UK distribution.

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However, it cited Brexit as an area of concern that could impact on its profitability.

Bob Terris, Meachers chairman, said it was pleased with its latest results: “It is especially pleasing given the current challenges facing the industry and the ongoing uncertainty regarding Brexit,” he said.

“We believe that this progress will continue in the current year with further organic growth.”

However, Terris added: “We are concerned about labour shortages and the steadily rising cost of equipment and premises.”