Eddie Stobart reports jump in losses as it recovers from difficult year
Annual losses at logistics group Eddie Stobart have jumped significantly, following a £169m charge in December as a result of an accounting blunder.
Losses before tax rose to £238.9m for the 12 months to the end of November 2019, up from £22.3m a year earlier.
Exceptional costs were reported of £200.2m, up from £5.1m, to factor in the £169.2m impairment charge. Net debt rose by £54.9m to £214.5m.
Eddie Stobart sacked its chief executive and suspended trading in its shares in August last year, after an accounting investigation found its 2018 profit had been overstated by £2m.
The logistics firm nearly fell into administration before striking a rescue package with shareholder Douglas Bay Capital Fund (Dbay) in December. The deal left Dbay with a 49 per cent holding in Eddie Stobart.
Accountancy watchdog the FRC said last month it has launched an investigation into audits by KPMG and PwC of the haulage firm.
“For obvious reasons much of this report deals with the past and makes for difficult reading but we are pleased to be putting these issues behind us,” said Eddie Stobart executive chairman Adrian Collins.
“Since I have joined the board, I have been impressed with the calibre and dedication of the Eddie Stobart leadership team and look forward to the future with optimism.”
The deal with Dbay saw the fund inject £55m into the business to hold it over the uncertain Christmas period. Despite the impact of coronavirus, Eddie Stobart said today that its management team still “believes the group continues to be well funded in this period of uncertainty”.
The firm said while there had been some volume reductions in parts of the business during the pandemic, the group has benefited from its “traditional strong exposure to fast-moving consumer and grocery goods, as well as its e-commerce related activities”.
Revenue grew 9.7 per cent to £857.1m, from £781.5m in 2018, which the firm said was primarily due to the contribution of its acquisition of TPN in 2018.
Excluding TPN, like-for-like revenue was flat.