5 Apr 2022 07:00
5 April 2022
Trading Update
And
Notice of Results
Strong Q4 trading and continued progress on strategic delivery
Wincanton plc, a leading supply chain partner for UK business, today issues the following trading update ahead of its full year results for the year ended 31 March 2022.
Highlights
· Group Q4 revenue is expected to increase +13% on an underlying basis excluding disposed businesses
· Excellent growth in strategic focus markets:
o eFulfilment full year revenue +56% including the acquisition of Cygnia (+41% excluding acquisition)
o Public and Industrial full year revenue +18%
· Credit facilities renewed and increased to support growth strategy
· On track to deliver profit performance in line with market expectations1
Strong Q4 performance with further contract wins and successful mobilisations for new business
Wincanton has continued to deliver strong revenue growth throughout the period, with positive contributions from all four of the Group's sectors. Group revenue is expected to grow by 12% compared to the same quarter last year, or 13% on an underlying basis excluding the impact of disposals. The Group continues to perform in line with current market expectations for the full financial year.
efulfilment is expected to deliver year-on-year growth of 56% for the full year including the Cygnia acquisition (expected +41% excluding acquisition). Cygnia has been integrated into the business and the combined business is generating a healthy pipeline of prospects. Online volumes continue to be influenced by the public response to the relaxing of pandemic restrictions as high street sales return, however the medium-term outlook for online eFulfilment remains strong.
Public and Industrial is expected to show year-on-year growth of 18% for the full year. In addition to being appointed to run a new DEFRA site within the Sevington Inland Border Facility, the Group has secured a further contract to process and store PPE on behalf of the Government. This involves sourcing 330,000sq.ft. of storage space via our innovative shared warehousing platform, OneVAST warehouse.
Our two retail sectors, Grocery and Consumer and General Merchandise, are expected to grow revenue year-on-year by a combined 17%. A key success during the period has been the mobilisation of the recently secured Primark contract for the management of all their UK warehouse-to-store transport logistics. This has involved securing 160 pieces of transport equipment and the recruitment or transfer of 96 driver colleagues and demonstrates Wincanton's capability to seamlessly deliver contracts of this scale.
Wincanton has successfully signed a renewal to its credit facilities for a further four years until March 2026 and has extended this commitment up to £175m. This funding will be available to support the continued delivery of the Group's growth strategy.
On track to deliver in line with market expectations
Driver and labour shortages have stabilised following the peak activity of the previous quarter and the Group has been successful in increasing its employed driver colleagues by 260 to 5360.
Wincanton has reviewed its own supply chains and procurement channels in response to the conflict in Ukraine and the economic sanctions placed on Russia. Management will continue to closely monitor key suppliers, though the Group remains confident its supply channels are robust. Wincanton is largely protected from the recent increases in fuel prices through the structure of its contracts, however the Group continues to work closely with customers to manage these cost pressures.
The Board is confident in the future growth opportunities and is pleased with the continued progress made against Wincanton's stated strategy.
The Group will announce its full year results for the year ended 31 March 2022 on 20 May 2022.
James Wroath, Wincanton's Chief Executive Officer, said:
"Wincanton has delivered a strong final quarter performance, maintaining the positive momentum we have seen throughout the year and with all four parts of the business contributing positively to our growth. We continue to deliver against our strategy, with significant growth in our focus markets of eFulfilment, public and infrastructure, and we are well placed to capitalise on the opportunities we have ahead of us in the coming year."
Footnote
1 Consensus for the year ending 31 March 2022 is adjusted profit before tax of £56.5m within a range of £55.5million to £57.0million
ENDS
For further information please contact:
Wincanton Plc Tel: +44 12 4971 0000
James Clarke, Interim Chief Financial Officer
Headland Tel: +44 20 3805 4822
Susanna Voyle/ Henry Wallers/Marta Parry-Jones
E: wincanton@headlandconsultancy.com
Notes to Editors:
About Wincanton
Wincanton is a leading British supply chain solutions company. The Group provides business critical services including storage, handling and distribution; high volume eFulfilment; retailer 'dark stores'; two-person home delivery; fleet and transport management; and network optimisation for many of the UK's best-known companies.
It is active across a range of markets including food and consumer goods; retail and manufacturing; eCommerce; the public sector; major infrastructure; building materials; fuel; and defence. With almost 100 years' heritage, Wincanton's 20,000-strong team operates from more than 200 sites across the country, utilising 3,500 vehicles.