Transport Development Group, the distribution company which has been undergoing a significant reorganisation in the last few years, reported a modest rise in profits yesterday but better news on like-for-like sales, which increased for the first time since the 1980s.
Comparable sales rose by 3.5 per cent, due largely to an improved performance from the hire division, which has seen increased business from cable companies. The industrial distribution division, which operates services for paper and chemicals companies, has also picked up new accounts.
The consumer division, which operates distribution systems for the big supermarket groups, has had a tougher time as the superstores become increasingly sophisticated in their buying-in of such services. Profits in this division fell slightly to pounds 9m.
TDG announced another restructure last month when it regrouped its logistics activities to improve focus and strip out artificial barriers between divisions. The shake-up follows a rationalisation programme, which has reduced the number of operating units from 90 to 30 during the last five years.
TDG has also been selling off peripheral businesses. It had raised pounds 46m from disposals by last year and reinvested around pounds 27m in the expansion of the plant and light vehicle hire division.
Pre-tax profits for the six months to June increased by 2 per cent on sales up by a similar amount to pounds 246m. Gearing is only 5 per cent. The shares fell 7p to 225p