Record sales but profits dip at Salford Van Hire
PROFITS have been hit at vehicle hire group Salford Van Hire, despite record sales.
The family-owned company which has a fleet of more than 6,500 cars, vans and trailers saw turnover rise 5% from £49.9m to £52.6m during 2008, newly-filed accounts at Companies House reveal.
Profits fell from £3m to £1.8m as the company had to pay higher interest charges of £4.1m, up from £1.8m in 2007.
Salford, which is based behind Manchester’s Strangeways prison, and has an depot in Leeds, saw most of its sales growth come from its subsidiary in Florence Italy.
UK turnover rose from £44.8m to £45.8m, while sales in the EU rose from £5m to £6.7m. Founded in 1966 by Raffaello Bacci, Salford opened the Italian operation in 1984.
In their report Salford’s directors said: “The group achieved a record year of sales. However increases in costs in an increasingly competitive business environment have eroded margins resulting in a decrease in profits.
“Finance charges have increased during the year reflecting both the addition of motor vehicles and the market conditions.”
Despite the fall in profits the company expresses confidence for future growth, stating “current year sales are encouraging.”
“The group’s key performance indicators is group revenue and this increased 5.4% on the previous year. Given the difficult trading conditions the directors are satisfied with this increase.”
The company balance sheet reveals a rise in asset value from £116.3m to £133.5m. Net assets grew from £44.3m to £48.3m. During 2008 net debt rose from £60.5m to £76.9m.
