NWF acquires fuels distributor for £10m

Cheshire fuels business going strong

Fuels business NWF has acquired Sweetfuels for £10.0 million to bring its network on UK depots to 26. 

The stock market listed fuels business has also issued a trading update boasting a better than expected year so far.

Warmer than usual weather over the Autumn months saw reduced consumption of heating oil, but strong margins offset this drop in overall sales. Demand from customers for food products has been stable and service levels have remained high, while the business has been effective in passing on inflationary cost increases to farmers.

The addition of Oxfordshire based Sweetfuels to NWF’s business expands and infills NWF’s geographic coverage of its fuels business within the UK and is aligned to a strategy of consolidating in the highly fragmented fuels market and expanding geographically.

In the 12 months to 31 August 2021, Sweetfuels generated EBITDA of £1.3 million, profit before tax of £1.2 million and had net assets of £2.8 million.

The total purchase price of £14.3 million includes £4.3 million of adjustments for surplus cash and normalised working capital. NWF reported net cash of £9.0m at the end of the financial year ended 31 May 2022, together with substantial bank facilities to fund more development opportunities.

Richard Whiting, chief executive of NWF, commented: “We are delighted with our performance in the first half and to announce the acquisition of Sweetfuels which adds a 26th depot to our UK footprint in an attractive new geography for NWF. We have a strong platform for continued growth as we leverage the benefits from the further expansion of our growing network.

“The industry remains highly fragmented, with many small operators, which provides us with further opportunities to consolidate the market and increase our market share. Our pipeline of acquisition prospects remains healthy and this remains a focus for our development activity.”

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