Positive start to the year for Smiths News with contract renewals delivering platform for growth
Major contract renewals representing more than 90% of its ongoing revenue have given newspaper wholesale group Smiths News a positive start to the year.
The Swindon-headquartered group, which has been trading for more than 200 years, said this underpinned both its short and medium-term revenue as well as the expansion of its early morning supply chain activities.
The group, the UK’s largest news wholesaler, has major contracts to distribute newspapers and magazines to retailers across the UK from a chain of warehouses and delivery depots.
In interim results for 26 weeks to 1 March, the group said it was continuing with its ongoing internal investment programme to support delivery of its core capabilities.
These include the roll-out of a new warehouse management system to other key depots across Smiths News footprint.
It also said a stable performance from its news and magazines business underpinned the performance during the period and put it on track to deliver around £5m of cost savings in its current financial year.
Growth initiatives were progressing well across all three of its key target verticals, supported by its “unrivalled expertise in warehousing, reverse logistics and early morning final mile services”, it added.
Revenue inched down by 0.6% to £536.4m against the equivalent period last year with adjusted operating profit up 3.2% at £19.4m.
Chief executive officer Jonathan Bunting said the business had made a good start to year and was on track to deliver full-year results in line with market expectations.
“The News and Magazines business continues to underpin our growth ambitions, as we seek to further leverage our early morning supply chain expertise and expand our offering,” he added.
“Having now renewed over 91% of our existing publisher contract revenues through to 2029, not only does this provide the business with excellent visibility across the medium term but provides an enviable platform to deliver additional stakeholder value.”
Smiths News distributes newspapers and magazines on behalf of the major national and regional publishers, delivering to around 22,100 customers across England and Wales on a daily basis.
The speed of is turnaround operations and the density of its coverage means it boasts one of the world’s fastest physical supply chains.
A trial with global greetings card group Hallmark to deliver its products to independent retailers, which started in February, had started well, it said. Progress will be reviewed progress throughout the second half of this year.
