7th March 2023
This announcement contains inside information.
WINCANTON PLC
(“Wincanton” or “the Group”)
Pre-close trading update
Wincanton plc, a leading supply chain partner for UK business, today provides an update on its trading performance and outlook.
Pre-close trading update
Ahead of its results for the financial year ended 31 March 2023, the Group confirms it has continued to trade in line with expectations and anticipates delivering revenue growth of approximately 3% and profit before tax growth of over 5%. This financial performance is despite the headwinds of inflation, labour supply shortages and consumer spending downturn. Working capital, cash and debt have been managed tightly and the Group forecasts a net cash position at year end of between £0m and £10m.
Contract update and outlook
The Group has been notified by HM Revenue and Customs (“HMRC”) of its decision to move to another supplier for the provision of logistics services to support UK customs arrangements at inland border facilities, following a retendering process. The contract will be transferred by June 2023. Wincanton is extremely disappointed to lose this business after a well-executed implementation delivered in exceptionally shortened timescales and acknowledged strong performance over the past two years. Wincanton remains a strategic government commercial partner with major contracts with HMRC, Defra, the Department for Health and Social Care and the Cabinet Office.
Alongside the loss of this contract, and as previously announced, Wincanton continues to expect a more challenging external environment in the coming financial year, including an accelerated reduction in consumer spending and customer volumes. The combination of these factors will impact financial performance in FY24. The Group now forecasts a reduced profit before tax for FY24 materially lower than current market consensus1.
The Group continues to see significant growth opportunities across both the eFulfilment and Public and Industrial sectors, alongside its resilient and high-performing foundation sectors: General Merchandise and Grocery and Consumer. Additionally, Wincanton is continuing with its development of technology for both warehouse automation and Transport Control Towers to significantly increase the value the business creates for both its customers and shareholders over the medium term. The Group remains confident in its strategy and its ability to deliver sustainable growth.
| Notes: | |
| 1. | based on current Company compiled market consensus PBT for FY24 of £63m |
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