Ryton logistics hub set to herald new era for UK Mail
LOGISTICS group UK Mail has said the opening of its new operational hub in the West Midlands will see the company embark on a new era.
The company is building the new distribution centre at Prologis Park, Ryton, near Coventry after receiving compensation from the Department for Transport due to its existing hub in Birmingham lying in the path of the route of the proposed HS2 high speed rail line. The hub is due for completion next May.
In its interim results statement, the company said: “The move of our national hub and Birmingham head office to a newly constructed site at Ryton will be the largest strategic development in the history of our business.
“The new automated hub will be a significant step forward in how we operate, creating extra capacity and reducing operating costs. The construction and automation project is progressing well, to budget and timetable and, in parallel, a detailed programme to manage the relocation is underway.”
The company said it was now in a period of significant investment and transition, as it put the infrastructure in place for the next phase of growth.
“Ours is a growth market that is rapidly polarising between high quality, innovative and sophisticated operators and those at the opposite end of the value scale. Against such a backdrop, the investments we are making place us at a significant competitive advantage for the medium and longer term,” it said.
The interims show the group remains on a sound footing with net funds at the end of the six months reaching £9.5m (2013: £19.5m) after making allowances for the capital expenditure of £17.9m.
Group revenues of £241.4m were level with the previous year, adjusting for one less working day (2013: £243.4m). Group operating profit (pre-exceptional) increased by £0.1m to £11.4m, adjusting for one less working day (2013: £11.8m).
Group pre-tax profit (pre-exceptional items) was £11.4m, level with the previous year, adjusting for one less working day (2013: £11.9m).
Exceptional items totalled £6.5m (2013: £nil), comprising a goodwill impairment of £7.3m at its Pallets division, which was offset by HS2 compensation of £0.8m.
The board has declared an interim dividend of 7.3p per share; an increase of 2.8% (2013: 7.1p), payable on January 16, 2015 to shareholders on the register on December 5, 2014.
Guy Buswell, Chief Executive Officer of UK Mail, said: “Overall the group had a satisfactory first half, with adjusted operating profit ahead of what was a very strong performance in the first half of last year.
“Trading in the initial weeks of the second half, and overall trends within our individual businesses, have been as anticipated, with our peak trading weeks still to come. Our expectations for the full year remain unchanged.”
