Wincanton is confident in its growth prospects for the current financial year, as it begins to see the benefits from the disposal of its records management arm and the termination of loss-making contracts in its Pullman Fleet Services business.
Chief executive Adrian Colman told MT the operator was focusing on “good value propositions” for customers in the retail and consumer market, as well as capitalising on the growth in the construction and e-commerce sectors.
Colman said: “We’ve got our act together and we are giving good propositions to customers, and they like it.
“In the retail and consumer market, those guys are facing a lot of challenges, not least with currency… so they are looking for providers that can give them really good value solutions that will drive savings.”
He put the company’s 2.6% drop in turnover to £1.11bn in the year to 31 March 2017 (2016: £1.14bn) down to the loss in revenue following the disposal of its records management business in 2015, as well as the tail-end of loss-making home shopping contracts in its Pullman Fleet Services business.
Pre-tax profit dropped from £65.8m in 2016 to £45.4m in 2017, but Colman said the 2016 figure included a £32.5m gain from the disposal of its records management business.
“If you exclude that disposal then its gone up quite substantially, something like 17% like-for-like,” he said.
Wincanton expects turnover and pre-tax profit to grow this year, following several contract wins from companies such as Wilko, Wickes and Ikea. It also secured an extension with Screwfix to manage a warehouse, and a national transport operation with Britvic.
Colman said: “A lot of those wins were in the second part of the year, so the impact on the revenue is not noticeable in the final months of 2016/2017. It’s going to be more noticeable in 2017/2018, so I’m relaxed about the revenue trend.”
The company also bought more than 100 ready-mix concrete vehicles for its construction logistics business.
He said: “Both [construction and e-commerce] are strong markets in the UK. If you get into those markets then you should be growing along with them. The ready-mix market is a very fragmented market of largely owner-operators, and over the next 10 years we will see a lot of those guys retire.”
