Transport facing a tough year, warns Gregory chief
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by Simon Jack
JOHN GREGORY, chief executive of Gregory Distribution, has warned that rising costs and the general economic picture will create a very tough year for the transport industry.
Speaking after the group published its inancial results, he says: “The current fuel situation reminds me of September 2008 when prices rose exponentially, as they are at the moment.” This, he believes, comes at a time when customers are unlikely to pay increased rates and when equipment costs are also rising for companies looking to invest. However, the recent swathe of administrations and company failures means there are now fewer players tendering for contracts.
“There has been a tightening on the supply side, which will mean opportunities for good transport companies offering a good service,” he says.
Gregory Distribution (Holdings) published its inancial results for the 17month period to 30 September 2010, which took account of its acquisition of Plymouth-based pallet specialist Kay Transport in 2009 and the setting up, last February, of Hayton Coulthard Transport, its joint venture (JV) with Hayton Coulthard Forwarding in Scotland.
Group turnover for the 17 months was £154.3m, including a £14.6m contribution from Kay Transport and £5.3m from the JV. This compared to a turnover of £91.3m in the year to 30 September 2009 that did not include acquisitions made by the business. Pre-tax proits were £5.6m and £4.2m for the same periods, using the same criteria.
Gregory says the group will focus on growing the proitable elements of its business. “Within the mix of our activities some parts are doing better than others. But we can’t afford to carry anything that isn’t proitable with margins as wafer thin as they are in our industry,” he says.
Results have also been published for Gregory Distribution, which saw a drop in pre-tax proit to £2.2m in the 12 months to 30 September 2010, compared to £4.2m the year before.
This was blamed on weather conditions and rising fuel prices, which contributed to a 7% increase in direct operating costs. Turnover grew from £91.3m to £95.2m during the period, boosted by renewal of a biosolids transport contract with South West Water and new contracts with Booker and Spar wholesaler Appleby Westward Group.