Wincanton sees FY profit ahead of market expectations

Logistics company Wincanton said on Wednesday that full-year underlying pre-tax profit is set to be "significantly ahead" of current market forecasts and no less than £30m.

Wincanton put this down to its "strong new business performance, early cost intervention measures and the recovering economy" but also cautioned that it assumes no further Covid-19 impact on volumes.

In a statement ahead of its annual general meeting, the company said it has continued to see a steady recovery in trading since its preliminary results in June. Demand levels have improved across most of the business, particularly in home delivery operations and eFulfilment, although volumes in areas such construction and fuel distribution are still below last year.

Wincanton said cash collection and liquidity management remain "strong" and current net debt is still "significantly below" the prior year position, mainly due to the deferral of payments.

Chief executive officer James Wroath said: "Despite the challenges Covid-19 has presented us, the group has been successful in winning new business and renewing existing contracts, positioning us well for future growth."

Broker Liberum said Bloomberg has consensus expectations at £18.7 for annual underlying pre-tax profit, while it expects £22m.

"We anticipate consensus estimates rising, although perhaps not to beyond £30m profit before tax given potential concerns about further Covid-19 impacts later in the year."

At 1250 BST, the shares were up 8.9% at 187p.