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Fuel rises tarnish Eddie Stobart performance

  • 17 May 2012
  • By Christopher Walton

A quarter of the revenue increase at Eddie Stobart in the past year was down to the increasing cost of fuel being passed on to customers.

But the rise in rates did not off-set all cost pressures, and the transport and warehousing division of Stobart Group saw profit fall for the period.

For the 12 months ending 29 February turnover rose to £519.5m, from £475.3m a year ago. But profit before tax fell from £34.2m to £27.4m.

Stobart admits that it was hit with cost rises of £4m “which have not been fully recovered through rate increases, mainly due to the increase in our customers’ costs”.

During the same period it also closed its depot in Leeds and reduced headcount by 284 in the ambient fleet.

Stobart is also restructuring its chilled operations, with the closure of its Corby and Alcester distribution centres (DCs), transferring to a new site in Manga Park, near Lutterworth in Leicestershire.

The chilled business, despite winning a new contract with Arla Foods it saw a volume decline, equating to a fall of approximately £3m.

Chief executive Andrew Tinkler tells Commercialmotor.com: “It is a tough environment and we are bumping along the bottom. Going forward, and even in the second half of the last financial year, margin improvements have come through.

“Our restructuring will be done by the end of June. Our customers buy into what we are trying to do.”

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Article source: http://www.commercialmotor.com:80/latest-news/fuel-rises-tarnish-%C2%A3520m-turnover-at-eddie-stobart