TRANSPORT group Stobart reported a fall in revenues and pre-tax profits, but achieved an improvement in margins, it said today.
The Warrington-based group’s six month results to August 31 showed a 5% fall in revenues from £281.1m to £278.5m. Pre-tax profits of £6.6m compared with £14.7m, although underlying pre-tax profits were £13.2m against £16.4m in the same period last year.
Underlying profits in transport and distribution, which suffered a fall in revenues, were £14.2m compared with £13.7m as a result of a 10% improvement in margins.
Infrastructure and engineering saw underlying profits fall from £1.2m to £400,000; the air division made a £300,000 loss compared with a £200,000 profit the previous year; while biomass doubled profits to £800,000. The estates division posted a £2.8m profit against £4.5m, although this is mainly internal work where the value is not realised until disposal.
Chief executive Andrew Tinkler said: We have worked hard to improve margins and profitability in our core transport business, despite tough trading conditions. We are well underway with delivering the stated plan for the group.”
Looking ahead the group bought Autologic Holdings in August, a provider of distributions and technical services to the automotive industry.
Deputy chief executive Avril Palmer-Baunack, said the business has 21 locations around the UK, including Liverpool and Ellesmere Port which distributes vehicles for Jaguar Land Rover and Vauxhall, respectively.
Southend Airport was declared the sixth London Airport and saw passenger levels soar during the London Olympic Games. Work will start on a terminal extension next month which will be one-and-a-half times bigger than the current site and ready to open in December 2013.
Chief financial officer Ben Whawell explained some of the costs affecting profits in the period involved £4.2m of restructuring charges, including the chilled division.
But he said the acquisition of the chilled operation from administrators in 2008 sparked the biggest development so far at the group’s Widnes multi-modal site where Tesco developed a major distribution hub.
He said: “We bought the chilled business out of administration which gave Tesco the confidence to go ahead.”
Mr Tinkler added: “We bought the chilled operation for £1 and have made £2m profit already.”
The group plans to develop Widnes further. Mr Whawell said: “There are still a number of projects in the pipeline and we are looking to develop 1.4m sq ft of warehousing.”
Mr Tinkler added: “We have also put in a planning application for a biomass plant there.”
Touching further on plans for the biomass division he said: “We are confident of future growth in the UK biomass market, although slightly behind our expected timescales due to delays in legislation.
“Major new contracts are commencing and customers are indicating increased volumes in the second half. This is also expected to increase demand through our transport division.”