More NFC jobs at risk
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• The NFC group, the UK's largest transport operation, spent £8m on redundancy payments in 1990 and more job losses are threatened in 1991 as the company battles to retain its profitability against a background of poor first quarter results.
However, 1990 was described by chairman James Watson as producing a "good result in a tough year" with pre-tax profits up 8% from 1989 to £97.7m, on turnover up 9% to £1.6bn.
At NFC's AGM in London last Saturday. Watson predicted that the group would move into new areas of business in the 1990s and was ready to invest £500m in business opportunities by 1995. He believed that as much as 50% of the group's operations would be overseas by that time. Last year NFC made seven acquisitions, only one of them in the UK.
Chief executive Jack Mather said the group's "best view for 1991" is pre-tax profits of around £100m on a turnover of 1.75bn, reflecting little upward movement. The first quarter of 1991 compares badly with the first quarter of 1990 with the Gulf war having a depressing effect on all NFC's markets, particularly travel and property.
However, the transport division shows "some signs of recovery", says Mather, with all of its companies except Lynx having a better first quarter than last year.
"We are ruthlessly pruning costs in staff, vehicles and property but opportunities still exist in contract hire and logistics," said Mather, warning, "activities that do not pull their weight will be disposed of.
"We had a satisfactory year, but not a vintage one," he added, pointing to the poor performance of BRS, although Exel performed well with acquisitions in Spain and the US. Pickfords is now only "half as dependent on home moves as it used to be", said Mather.
The group was successful in holding fuel costs down to 5% of any contract's running costs. It imposed surcharges when necessary.
NFC has targeted four areas for expansion: logistics, worldwide moving, contract hire and overseas property.