4th Jun 2015 07:27
LONDON (Alliance News) - Supply chain services company Wincanton PLC Thursday said its pretax profit excluding the impact of pension changes rose in its recently-ended financial year, as its revenue increased on the back of new business wins and renewals.
Pretax profit in the year to end-March fell to GBP24.9 million, from GBP34.9 million a year earlier when it had booked a GBP15.8 million gain due to the impact of changes to its pension schemes. Excluding this, the profit figure rose to GBP31.4 million, from GBP25.6 million, as revenue increased to GBP1.11 billion, up 0.9% from GBP1.10 billion a year earlier, and a margin improvement in its contract logistics business more than offset lower margins in its Pullman operations.
Revenue was boosted by contract renewals with clients like French oil group Total SA and FTSE 250-listed Britvic PLC and a new business win from Lavendon Group PLC, the equipment rental company. It also signed a logistics contract with kitchens and joinery products company Howden Joinery Group PLC and signed deals with defence companies BAE Systems PLC and General Dynamics Inc.
The company, which runs a fleet of lorries, sees little impact from fuel price changes as it passes on the cost of fuel to its customers. If anything, the fall in fuel prices during the year as the oil price sank, was a slight disadvantage as it reduced revenue.
The company is not recommending any dividend payout, in line with a year earlier, as it continues to focus on reducing its debt obligations.
Its net financing costs fell to GBP18.3 million, from GBP22.4 million, thanks to lower interest on its loans and lower pension financing charges. Net debt dropped to GBP57.6 million, from GBP64.9 million a year earlier.
"I am pleased to report that Wincanton has continued to deliver against our strategy in the year and achieved revenue and profit growth plus further reductions in net debt. This was attributable to continued operational excellence, delivering value added services and our focus on close customer relationships," said Chief Executive Eric Born.
"Whilst existing customer retention and cost efficiencies will continue to be our key value drivers, increased emphasis is also being placed on winning new business where long term collaborative relationships can be built as well as returning the Pullman business to profitability. The emphasis on further increasing free cash flow generation and paying down net debt will also continue. The board expects that Wincanton will show continued progress during the coming year," the company said in its outlook statement.
Shares in Wincanton were up 1.2% to 173.822 pence on Thursday.
By Sam Unsted; [email protected]; @SamUAtAlliance
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