20 January 2022
("Wincanton" or the "Group")
Q3 TRADING UPDATE
Wincanton delivers strong trading performance; upgrade to full-year profit
Wincanton plc, a leading supply chain partner for UK business, today announces an update on its third quarter ("Q3") trading performance, including the seasonal retail peak activity.
The Group has continued to see strong trading across all four business sectors, with high demand for its services. Group revenue grew by 15% compared to the same quarter last year, or 14% excluding the impact of acquisitions and disposals. Given the strong Q3 performance, and with greater certainty regarding the mitigation of cost pressures, the Group now expects full year profit to exceed current market expectations.
Our Digital and eFulfilment sector revenue increased by 51% in the third quarter, driven by the acquisition of Cygnia, our specialist high-volume eFulfilment business and new business commenced earlier in the year. Excluding Cygnia, sector revenue rose by 22%. Wincanton's Customer Fulfilment Centre for Waitrose.com executed the successful delivery of its first Christmas peak trading period. The two-person home delivery business contributed another quarter of strong performance, although volumes were down slightly compared to a particularly busy quarter in the previous year. The integration of the Cygnia business is progressing well, although online volumes for some customers were impacted by a higher-than-expected proportion of high street sales around Black Friday.
Wincanton delivered a seamless peak period for its Grocery and Consumer sector customers, delivering 25 million cases of food and drink in the week before Christmas. Revenue in this sector rose by 19% in Q3 compared to the prior year. The Group also benefited from a strong performance in the General Merchandise sector, where quarterly revenue grew by 9%.
The Group's Public and Industrial sector revenue rose 5%, primarily driven by the growth of Public Sector business. The quarter saw the commencement of operations at Wincanton's sixth inland border clearance facility in Holyhead, Wales, the latest milestone in the contract with HMRC for these services.
The challenges of driver and labour shortages were managed successfully through the period to ensure the upturn in peak activity was appropriately resourced. The Group continues to work collaboratively with its customers to optimise service levels, mitigate supply chain risk and manage cost pressures.
Wincanton has secured a number of significant contract wins and extensions in the period. In the Public Sector, the Group was awarded a new contract with the Department for Environment, Food and Rural Affairs (DEFRA), initially for a two-year period, to operate an inland border control post in Kent. Wincanton will be operating the site and creating 300 new jobs to manage biosecurity checks on goods coming into the UK from the EU.
Wincanton is also extending its partnership with DFS to manage those deliveries that go directly from suppliers to customer. New services for The Range, MGA Entertainment, Lakeland and Department of Health and Social Care (DHSC) were implemented in the period, as the Group saw strong take-up for its collaborative warehousing services. The Group is on track to deliver its previously announced five-year contract with Primark for the provision of transport services to all its UK stores, commencing in February.
James Wroath, Wincanton Chief Executive Officer, said:
"Wincanton has continued to deliver value for its customers and this has generated another strong financial performance over the past quarter. Looking ahead, the business is on the right track. We are maintaining our relentless focus on the delivery of our strategy, with innovation and new technologies driving growth throughout the business. I would like to thank all my colleagues, as ever, for their fantastic work through the recent peak trading periods."
For further information please contact:
Wincanton Plc Tel: +44 12 4971 0000
Tim Lawlor, Chief Financial Officer
Headland Tel: +44 20 3805 4822
Susanna Voyle/ Henry Wallers
Notes to Editors:
Wincanton is a leading British supply chain solutions company. The Group provides business critical services including storage, handling and distribution; high volume eFulfilment; retailer 'dark stores'; two-person home delivery; fleet and transport management; and network optimisation for many of the UK's best-known companies.
It is active across a range of markets including food and consumer goods; retail and manufacturing; eCommerce; the public sector; major infrastructure; building materials; fuel; and defence. With almost 100 years' heritage, Wincanton's 20,000-strong team operates from more than 200 sites across the country, utilising 3,500 vehicles.