Wincanton slid into the red ahead of its £760m sale to US supply chain management giant GXO in April this year, reporting an annual pre-tax loss of £44.9m, according to its latest financial results.

The Wiltshire-based group’s latest financial results, for the year to 31 March 2024, reveal turnover dipping to £1.4bn (2023: £1.46bn). However the group made a pre-tax loss of £44.9m compared to a pre-tax profit of £38.2m in the previous year.

Wincanton’s strategic report to the results attributed the profit slump to costs related to its acquisition by GXO and the impairment of Cygnia, the group’s efulfilment and two-person home delivery service, which was hit by “macro-economic headwinds” and the loss of a key home delivery customer, as well as “onerous” contract provisions relating to the customer loss.

Performance across its four divisions was mixed, with only Wincanton’s efulfillment arm seeing revenue growth. The division reported revenue up by 9.4% in the year, despite “softer retail volumes.”

Meanwhile Wincanton’s grocery and consumer division saw revenue fall by 2.5%, thanks to the impact of the cost of living crisis on shoppers. On the upside, a new major contract with Sainsbury’s offset the loss of its Morrisons, Lucozade and Ribena Suntory contracts, the report noted.

Wincanton’s general merchandise division also saw revenue decline, down by 6.9%, despite a “significant” new three year transport and distribution contract win with fashion retailer New Look.

The sector also landed deals with solar energy and storage distributor SEGEN and JD Sports in the period.

The group’s public and industrial division also recorded a revenue drop, down by 13.4%, which Wincanton partly attributed to a strong prior year, boosted by its lucrative inland border contract with HMRC.

However Wincanton remains upbeat about the division’s prospects, pointing to its blue chip customer portfolio - which includes BAE Systems, Thales and Tata Chemicals Europe - and to “significant” new business, including a three year contract extension and expansion with defence engineering company RBSL, a ten year warehousing and logistics agreement with Tata Chemicals Europe, and a new public sector contract with Supply Chain Co-ordination Limited to support with the post-pandemic management of PPE.

Summing up the group’s performance the strategic report concluded: “Wincanton delivered a robust financial and operational performance in a challenging external environment.”

It also noted that the £760m sale of Wincanton to GXO was “a testament to the group’s compelling strategy, operational excellence, strong customer relationships and talented team.”