9th Jun 2016 07:00
LONDON (Alliance News) - Contract logistics operator Wincanton PLC on Thursday reinstated its dividend for the year to the end of March following growth in profit and revenue and as the group substantially completed its restructuring.
Wincanton said it will pay a 5.5 pence dividend for the year, having not paid a dividend the year before as it undertook a restructuring and booked charges on unprofitable contracts. The group said it intends to institute a progressive dividend policy from here on, with annual payout growth to be broadly matched to underlying earnings growth.
A major part of the group's restructuring was completed over the course of the year, with the GBP60.0 million sale of its records management business to UK-listed office services provider Restore PLC. Funds from the sale were used to repay debt and make a contribution to the group's pension scheme.
The one-off charges booked a year earlier meant Wincanton's reported pretax profit grew substantially, up to GBP65.8 million from GBP24.9 million a year earlier. Underlying pretax profit, stripping out the one-offs, rose to GBP35.3 million from GBP31.4 million.
Revenue grew 3.6% to GBP1.15 billion from GBP1.11 billion year-on-year, helped by strong performances in winning new contracts and on higher volumes in its retail general merchandise logistics business. The new wins over the year included a five-year deal managing the distribution centres of DIY retailer B&Q and a three-year transport logistics deal with bicycles and car parts retailer Halfords Group PLC.
"After a year of continued progress, the reintroduction of dividends is an important milestone and an indicator of the health of Wincanton. We believe that the business is on a strong foundation, having reduced debt and onerous lease obligations over the last few years, to enable it to invest for future growth as well as to meet the needs of its key stakeholders," said Adrian Colman, Wincanton's chief executive.
By Sam Unsted; [email protected]; @SamUAtAlliance
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