Wincanton slipped into the red for the first time in more than 20 years in the year leading up to it being taken private by the logistics giant GXO, according to newly filed accounts.
Wiltshire-based Wincanton, which confirmed its £760m takeover by the US firm in January, made a pre-tax loss of just under £50m in the 12 months ended March 31, 2024, having made a pre-tax profit of £38m in the 12 months before.
This is the first time the company has recorded a pre-tax loss since it became listed on the London Stock Exchange in 2001.
Wincanton said the slump had been driven by the “costs incurred to sell” the company, “material impairments” and “”onerous contract provisions” recognised in the period.
During the year the company’s revenue dipped slightly to £1.4bn, down from £1.46bn in the year before.
Of its four divisions Wincanton’s e-fulfilment operation was the only one to grow its revenue year on year. During the year it increased by 9.4 per cent to £278m, up from £254m in the 12 months before.
The company said that this growth had been driven by a “consumer-led shift towards ecommerce” and growing recognition among its clients of the benefits of shared user services. It added that new business from Ikea in this division had helped to partially offset volume declines in other areas.
Wincanton saw its revenue decrease across all but one of its divisions
Despite online sales boosting its e-fulfilment operations, the revenue achieved by its public and industrial, grocery and consumer and general merchandise divisions shrunk.
Its public and industrial saw the biggest decrease, dropping by 13.4 per cent from the year before to just over £246m, down from £285m.
Wincanton said this decrease was down to “a strong prior year comparator” which included an inland border contract with HMRC. It added that the division remained “a significant area of opportunity” for the group.
In a statement published on Companies House the company said: “Wincanton delivered a robust financial and operational performance in a challenging external environment.
“However the group reported a loss in the year of £39.6m. This loss was driven by the costs incurred to sell Wincanton plc, material impairments and onerous contract provisions recognised in the period.
“The group reported an operating profit before non-underlying items of £64.6m for the year ended March 31, 2024.
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Wincanton’s GXO takeover
The US company GXO, headquartered in Connecticut, completed the acquisition of Wincanton in January in a deal worth £762m.
GXO secured the takeover after trumping an offer of 480p a share made by the French multinational CEVA Logistics. The Marseilles firm withdrew from the bidding war following GXO’s rival offer of 605p a share.
However a month after the deal was confirmed, the UK competition regulator (CMA) launched an investigation into the acquisition.
The CMA said it was “considering whether to make a reference under section 22 or 33 of the [Enterprise] Act.”
The businesses said they will continue to be run independently until the review is completed.
US-based GXO’s offer for Wincanton was one of the many buyouts of London-listed firms that have been agreed over the past few years, many at large premiums to the market price.
GXO offered a 104 per cent premium to Wincanton’s previous record high share price of 470p reached during the period to 18 January, the last business day before Wincanton received a £567m bid from CEVA.
In February, Currys rejected a £700m offer from Waterstones owner Elliot Advisors. Direct Line shunned a £3.1bn proposal from its Belgian peer shortly after