Underlying operating profit at Wincanton rose nine per cent in the first half to £24.3m despite a 12 per cent fall in sales to £551.2m reflecting the progress the company has made following its restructuring programme last year.
In the first half of 2011 the company made a total loss of £73m – that compares to a £9.2m profit this year.
The Contract Logistics division which now makes up more than 80 per cent of the business saw underlying operating profit rise 15 per cent to £20.1m while sales were down 13 per cent to £465m boosting margins to 4.3 per cent.
The company said the decline in revenue was mainly the result of contracts that were insourced last year which have yet to be offset by the new contract wins this year. New contract wins commence in the last quarter of our current financial year.
Profit slipped back to £4.2m at the Specialist Businesses division – largely as a result of the weakness of the container market.
Chief executive Eric Born said: “Our strategy to achieve a clear leadership position in the UK & Ireland supply chain market continues to gather momentum and our recent new business successes are a clear indication of how this is now delivering tangible results”.
“Our new business pipeline remains healthy and we continue to be successful in securing significant levels of customer contract renewals. We remain acutely focused on margin growth and free cash flow generation.”
* Jon Kempster, Wincanton’s group finance director, is leaving the group. With the structural aspects of refocusing Wincanton largely complete, including the disposal of the Mainland European operations, renewal of the Company’s bank facilities, and the triennial pension scheme valuation, he has decided that this is the right time for him to step down.
He will step down from the board with immediate effect but will remain with Wincanton until a successor is in place or until 31 January 2013.