Wincanton PLC Q1 Trading Update (6925F)
July 12 2023 - 2:00AM
UK Regulatory
TIDMWIN
RNS Number : 6925F
Wincanton PLC
12 July 2023
12 July 2023
LEI: 213800Z5WTW8QKOHWQ82
WINCANTON PLC
("Wincanton" or the "Group")
Q1 Trading Update
Further strategic delivery against a challenging external
environment
Wincanton plc, a leading supply chain partner for UK business,
today provides an update on its trading performance for the three
months ended 30 June 2023 ("Q1").
The Group continues to trade in line with market expectations
[1] , and has made sustained strategic and operational progress
despite the ongoing economic headwinds and resultant lower delivery
volumes. Group revenue in Q1 was down 4.5% year-on-year when closed
book transport contracts are excluded [2] . Year-on-year revenue is
10.4% lower when including closed book transport.
Sector Performance
As set out in the Group's full year results, the strategic
reorganisation in Transport was instituted to create a more
profitable and digitally enabled service offering, alongside a more
efficient allocation of capital. This offering is focused on the
development, delivery and management of technology-based solutions
and open-book dedicated networks. The Group is already seeing early
benefits from this strategic shift, with new Transport Control
Tower business for both Sainsbury's and Breedon. Our dedicated
transport contract with New Look has commenced and our
long-standing transport partnership with Halfords has been extended
for a further five years.
The Group's foundation sectors continue to provide scale and
strong cash generation in a challenging market. Revenue in Grocery
and Consumer decreased by 5.6% year-on-year and General Merchandise
was 16.9% lower, reflecting both volume reductions and customer
churn.
Revenue from eFulfilment increased by 15.0% in the first
quarter, demonstrating its importance as a growth driver. The Group
secured several significant new eFulfilment contract wins in the
quarter, all of which will commence in Q2. These contract wins
include the expansion of the IKEA network partnership into Ireland
and final mile delivery in Greater London, the UK launch of US home
retailer Restoration Hardware and fulfilment services for Neom
Organics and Brewers (Decorator Centres).
Revenue from the Public and Industrial sector increased by 2.1%
year-on-year, with growth in our Defence customers and EDF Hinkley
Point offsetting the reductions from the contracts with HMRC and
DEFRA. The Group secured new contract wins in the key Defence and
Industrial markets, expanding its partnerships with Rheinmetall BAE
Systems Land and British Salt. The Public and Industrial sector
includes construction closed book transport contracts. Where no
protection exists, these transport contracts are being exited in
alignment with our technology-based transport strategy.
Trading Outlook
Wincanton is well-placed to continue to navigate the challenging
external environment with its successful strategy and continued
investment in automation technology, underpinned by its diversified
customer base. The Group's strategic shift in transport towards
open book contractual agreements will deliver both financial and
operational benefits.
The Group maintains a resilient financial position with a strong
balance sheet and consistent cash generation. Management continues
to actively engage with the Wincanton Pension Fund Trustees to
agree an optimal contribution schedule in response to the ongoing
triennial valuation and expects to provide a further update at half
year.
-Ends-
For further information please contact:
Wincanton plc Tel: +44 1249 710 000
James Wroath, Chief Executive Officer
Tom Hinton, Chief Financial Officer
Headland Tel: +44 20 3805 4822
Susanna Voyle/ Henry Wallers
E: wincanton@headlandconsultancy.com
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.
The Group 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 20,300-strong
team operates from 160 sites across the country, responsible for
7,400 vehicles.
[1] Market consensus for FY24 PBT of GBP50.4m
[2] Year-on-year revenue comparisons provided in this update
exclude closed book transport contracts. When closed book transport
contracts are included, year-on-year movements of: Grocery &
Consumer -12.3%, General Merchandise -18.0%, eFulfilment +15.0%,
Public and Industrial -15.3%
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END
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