(Alliance News) - Wincanton PLC on Friday reiterated its guidance for financial 2021 and said that trading in the six months to the end of September was "resilient" despite a challenging environment.
The Chippenham, Wiltshire-based logistics company also said that it has reached an agreement on 2020 triennial valuation of its pension scheme and recovery plan.
Shares in Wincanton were up 6.2% at 225.10 pence each in London on Friday morning. Year-to-date the stock has shed a quarter of its value.
In the first half, Wincanton secured several new contracts and its Digital and eFulfilment business benefited from increased demand for online retail. New contracts won in the first include home delivery service for Waitrose, additional transport services with supermarket chain Wm Morrison Supermarkets PLC, a renewed contract for all operations of Asda, a unit of Walmart Inc, and a PPE storage solution to support the UK's National Health Service.
"The new contracts we have secured are clear evidence that this strategy is being implemented and is working," said Chief Executive Officer James Wroath.
Wincanton has retained its guidance of beating market expectations for financial 2021. For the financial year that ended March 31, the company posted pretax profit of GBP43.8 million on revenue of GBP1.20 billion.
It expects to have a net cash position of a GBP60 million at September 30 versus debt of GBP14.8 million a year ago.
Under the 2020 triennial valuation of pension scheme, the company has agreed to contribute GBP18.2 million per annum to its pension plan from April 2021 through to March 2024. From April 2024 to March 2027, Wincanton will pay GBP21.3 million per year.
"The annual cash contributions are GBP6 million per annum lower than proposed for the period from April 2021 to March 2027 under the 2017 valuation due to positive investment returns and longevity experience since the 2017 valuation was agreed," Wincanton explained.
To provide further protection to the pension scheme, the company also has provided a letter of credit of GBP3 million per annum. The scheme had an actuarial deficit of GBP154 million at March 31.
By Tapan Panchal; tapanpanchal@alliancenews.com
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