S&S Distribution, the Kent-based haulier snapped up by Palletline last year, recorded a pre-tax loss shortly after its purchase, newly published accounts show.

However, its new owner told Motortansport.co.uk it is back in the black.

The firm was bought by the network in May 2015 and in results filed at Companies House it reported a £48,000 pre-tax loss for the 11 months to 30 June 2015, compared with a profit of £208,000 in the previous 12 months.

Palletline said the loss could be attributed to “two one-off issues” and that the business has since “performed significantly better than anticipated”.

A Palletline spokeswoman said the directors had decided that S&S Distribution’s original goodwill was no longer appropriate, resulting in an impairment of £142,215. “This goodwill was created when the business transferred from a partnership to a limited company in 2005,” she said.

“The original goodwill was a reflection of the customer relationships that the business had at that time. However, in the 10 years since the goodwill was created the customer base has expanded and some of the original customers are no longer with the business.”

The other one-off issue was that the figures only included one month’s contribution from the profitable S&S Warehousing, which was acquired in May 2015 for £200,000.

“The business has an excellent workforce and management team led by MD Richard Ball,” she added. “Since its acquisition S&S Distribution has continued to trade profitably and performed better than anticipated.”

Although owned by Pallet-line, S&S Distribution retains its name and branding. The decision to buy the member is not unique among networks, but it was the first time Palletline has bought a shareholder.