The road transport sector saw a significant leap in both the money it is owed by creditors and what it owes to suppliers and contractors during the first quarter of the year, new data from Creditsafe shows.
While sales increased quarter-on-quarter by 1.3% to £36.6bn the sector’s retained profit slid in the same period by more than 11% to £343.4m.
Bad debt increased significantly with a jump of 337% quarter-on-quarter in regards the money road transport operators are owed, which stood at £1.8m.
Money owed to suppliers in the form of bad debts climbed nearly 30% to £5.3m in the first quarter of 2018 too, according to credit checking service Creditsafe.
Wages and salaries increased marginally to £9.3bn during the period as employee numbers jumped by 15% to 269,967.
The number of company failures declined to 76, compared with 112 in the final three months of 2017.
Newcastle-based Stiller Transport, which had an annual turnover of more than £18m, was the largest road transport failure in the first quarter. It is now in liquidation, according to Companies House.
The results broadly tracked the wider logistics sector, which in Creditsafe’s grouping includes passenger services as well.
Rachel Mainwaring, COO at Creditsafe, said: “The transport and logistics sector has seen a lot of uncertainty over recent months and clearly this had had an impact on retained profits.
“It’s certainly not plain sailing from here – Brexit remains an issue of major concern for the sector, particularly when it comes to freedom of movement – but hopefully the sector can jump on some of the spring-like signs of growth and lift itself out of the slump.”
