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Wincanton extends its reach
Page 26
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Wincanton's domestic turnover has risen by 10% — but on the Continent it has managed a 12% rise, mostly by following its customers to the east.
_ffitistimm Malian
Chris Morgan, Automotive & Logistics Datamonitor
Wincanton's interim results for the six months ending on 30 September reveal that the logistics provider boosted its turnover by 10% year on year to £879m -and pre-tax prof it almost doubled from £8.3m to £15.2m. The company's home market of UK and Ireland continued to supply the bulk of its revenue (65%) and operating profit (91%).
But operations on the Continent are also growing fast; revenue
rose by almost 12% 350 year on year. Last year Wincanton closed a site in Span and in January it acquired midiData, a German high-tech logistics provider. These
moves helped counter the effects of fuel price increases, with prof its rising from £300,000 to £1.8m.
The recent purchase of French company Premium Logistics, which took place outside this reporting period, indicates that the improvement will continue in the second half of the fiscal year.
These results seem to further vindicate Wincanton's initial approach to the Continental market. While most other major UK-based logistics companies made the move over the Channel as soon as they could, Wincanton made patience a virtue. making sure it was a trusted and successful service provider on its home soil before taking the plunge.
When the opportunity came, Wincanton was able to make a large debt-free acquisition giving it an immediate presence in the leading European markets.
As a result, Wincanton was well placed to capitalise on the trend for its customers to move east to cash in on low labour costs. This remains a key element of the company's strategy, as it is still heavily reliant on revenue from the UK and Ireland.
Also, with the imminent merger of Deutsche Post and Exel, Wincanton needs to be able to offer current and potential customers the widest possible coverage. Failure to do so could leave it trailing in the wake of its pan-European rivals.