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Bleak outlook for haulage shareholders
Page 8
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SHAREHOLDERS IN L.:K road haulage companies face a bleak outlook with only one in five operators delivering a good return on investment, according to new research.
Plimsoll Publishing says the industry's largest 150 companies, which account for 92% of the overall haulage market. are failing to grow organically and are increasingly looking to capture market share from each other.
This burst of -intense competitive pressure" has resulted in 121 companies delivering an average of just £3.50 return for every £100 invested in them. David Pattison, senior analyst at Plimsoll, is surprised by the number of hauliers that are failing to achieve the accepted investment return benchmark of 10%, "Directors of these companies would do well to remember their accountability and commitment to their shareholders," he says.
Plimsoll reports that 27 of the companies studied lose money and 18 of them have suffered losses for the second year running.
However it does list 29 star performers delivering an average 15.5% return on investment. Exel, Gefco UK and Mears Group are three great examples of companies delivering to their shareholders," says Pattison. "They are doing something different applying rules to the industry that others are not, or are unable to do.
"Evolution is about entrepreneurship, seeking those corners of industry that are more profitable than the middle ground."
Plimsoll's research, Top 150 Road Haulage, examines each company's financial health and likely performance over the next 12 months. It costs £500 and is available direct from Plimsoll; phone 01642 626400 or visit www.majorcompathes.co.uk