Norbert Dentressangle says it is on target to bring the former Christian Salvesen UK transport business back to profitability. This business went into loss a few years ago as the manufacturing industries it served went into decline and resisted the best efforts of the Salvesen management to revive it.
Speaking on the announcement of Dentressangle’s half year results, Hervé Montjotin, executive vice president responsible for the group’s transport division, said it had put in place a recovery plan involving a number of measures. It has announced plans to redesign the network which involves closing three depots and that is expected to be completed by the end of October.
In addition, said Montjotin, it is implementing Dentressangle’s systems within the business to improve operating efficiencies. It is working on measures to reduce fuel consumption as well as cutting overheads and increasing driver productivity.
Even with the current economic downturn, the business should be back to break-even by the end of 2009, he said.
Overall, the group has reported sales up 7.5 per cent on a like for like basis while operation income is up 16 per cent on – again on a like-for-like basis. Total sales is now 1.6 billion euros while operating profit is 46.3m euros.
Montjotin said Dentressangle knew when it bought Salvesen that there was work to be done to bring the business up to the same level of profitability as its existing business – particularly the UK transport division.
The former Salvesen logistics business has performed in line with expectation and Montjotin said he expected to see further growth from it this year. The integration process has now been completed for this in the UK, he said. In contrast, the UK transport business is being kept separate while management focus on restoring its profitability.
Overall, said François Bertreau, chairman of the executive board: “I am very pleased with Norbert Dentressangle Group’s results for the first half of 2008. The performance for the historic consolidation scope was very good and the plan for integrating Christian Salvesen’s activities was implemented, effectively doubling the group’s size. As a result, I can confirm our growth and profitability targets for 2008 and am confident in the group’s capacity for further development.”
Organic growth is expected to be 6-8 per cent like-for-like based on 2007 proforma revenue (3.08m euros).