TDG has warned that profits for 2006 could be materially below those in 2005 because rationalisation in the retail sector means that renewal rates in UK contract logistics are lower than normal.
However, the group says it is in discussions on potential acquisitions which could have significant strategic and financial benefits.
For 2005, it expects headline profit before tax to be in line with expectations. UK Contract Logistics has traded at similar volumes to that in 2004. Both European Chemicals and UK Temperature Controlled Services have produced solid performances.
Market conditions in the Netherlands remain difficult and the group has responded by strengthening management and further reducing the cost base.
The annualised value of new business wins in the second half of 2005 has run at similar levels to that achieved in the first half and TDG expects the full year total to be well ahead of that in 2004.
This includes three significant contracts which are expected to be announced shortly and the Group has decided to increase its future investment in business development capability because of the growth opportunities that are available.