STOBART Group, the logistics specialist, said annual profits are likely to be at the lower end of expectations – but it would still deliver growth of 20%.

The Warrington-based group blamed cutbacks by Network Rail which will impact on its rail engineering operation, higher finance costs on a new £100m 10-year loan, January’s VAT increase and the effect of the comprehensive spending review on the economy.

Results for the six months to August 31 showed an 11.7% increase in revenues of £243.7m and a 38.7% rise in pre-tax profits of £15.4m.

The group employs about 1,000 staff at its Warrington haulage base and its rail, road and seaport hub in Runcorn and Widnes.

Chief financial officer Ben Whawell said the group continues to trade well, with £100m of new business delivered in the past 12 months.

Talks continue with prospective customers over warehousing and distribution opportunities at Widnes, and he added that the Runcorn port operation could benefit from wood imports linked to Stobart’s biomass joint venture.

He said the note on profits was “just a bit of caution”, adding: “We are trading very well. Even at the lower end (of profit forecasts), we will show 20% growth.”

Chief executive Andrew Tinkler revealed: “The second half has started encouragingly and we expect to see good growth across our businesses.

“In addition, we are in discussion with several other major customers, including biomass customers and airlines, which should significantly grow the business.”