Sharp ■ Informed ■ Challenging
12.7.21
Debt for equity swap slashed GreenWhiteStar’s borrowings by £65m
Stobart owner cut debt ahead of sale to Culina By Carol Millett
JOIN THE WA I T I N G L I S T
NEWS INSIDE DVS dispute
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Riding a wave
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Learning the lessons
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OPERATORS INSIDE Adrian Poole & Sons ...................................... p3 Aztek Logistics.............................................. p6 Carlton Forest ..............................................p32 DPD .............................................................p12 Europa Wordwide .......................................... p6 Gregory Distribution ...................................... p4 Hermes......................................................... p6 Hovis ...........................................................p11 Meachers...................................................... p6 Normal Global Logistics................................p25 Rendrive Haulage .........................................p25 Willmotts Transport .....................................p25 XPO .............................................................. p6
Eddie Stobart’s holding company GreenWhiteStar Acquisitions (GWSA), which was sold to Culina Group earlier this month, made a £15m loss last year and had net debts of £144.5m. For the year to 30 November 2020, the company revealed that it had gone some way to cutting both its losses and its debt burden, aided by a £65.3m debt for equity swap. Pre-tax loss dropped to £15m from £224.2m in the previous year, with turnover rising to £874m (2019: £857.5m). GWSA also said it had reduced net debt by £77.2m to £144.5m, down from £221.7m the prior year. The lion’s share of the debt reduction was in the form of a £65m debt for equity swap involving Alpha Cassiopeiai, a finance house based in the Isle of Man, which shares the same London office address as GWSA’s then majority shareholder, DBAY. GWSA said the repayment of debt was underpinned by a successful strategy of refocusing on core competencies. Despite the financial challenges, directors’ remuneration rose to £4.6m in 2020, up from £1.6m in 2019, with the highest paid director receiving £1m, up from £586,000 in 2019. In the same
THE NEW TEAM: Culina Group’s senior management team headed by Thomas van Mourik (front)
period the company received £5.8m in furlough payments from the government. Culina’s acquisition of GWSA, which owns Eddie Stobart, Eddie Stobart Europe, iForce, The Pallet Network and The Logistics People, comes less than two years after equity house DBAY acquired a 51% stake in GWSA in a £75m bailout that saved it from administration. One logistics director who declined to be named said: “This sale was inevitable. In this low margin industry to be loaded with that amount of debt and paying over 10% on your borrowings is a hiding to nothing.” He added that he was surprised at the level of fees that had been taken out of the business while receiving almost £6m in furlough payments. Also reporting results to
30 November 2020, Eddie Stobart Limited (ESL) slashed its losses by 77% after exiting a number of “unprofitable” contracts, implementing cost-cutting measures and adopting a new accounting standard. However, its decision to turn its back on “uneconomic” industrial, retail and bulk contracts also saw turnover fall by 7% to £559m (2019: £604m). Pre-tax losses fell from £33.4m in 2019 to just £7.7m in 2020. Losses reduced partly thanks to the implementation of accounting standard IRFS 16, which boosted operating profit by an additional £19.7m to £51m, up from a loss of £17.3m in 2019. ■ Puro Ventures, which trades as Speedy Freight, has undergone a management buyout that sees its founders leave the business and GWSA sell its remaining 20% shareholding in the company.
WEIGHTY ISSUE: The Pallet Network (TPN) is to charge for tail-lift deliveries in response to recently published safety guidance on pallet weights. The surcharge will be applied on all tail-lift deliveries from 1 August, which TPN said was aimed at protecting driver safety, service levels and profitability. The Sutton Coldfieldbased network is the first to add a tail-lift surcharge, which recognises the extra costs these deliveries incur and the levels of investment required under the new HSE-backed ‘RHA tail-lift and pallet truck guidance document’ published last month. Drivers must now carry out a dynamic risk assessment for residential tail-lift deliveries at each point of delivery. The news comes as TPN reported “unprecedented volumes” last year as it rebounded from the effects of Covid-19. Turnover for the year ending 28 November 2020 was up 6.2% to £137.3m. Pre-tax profit fell by a quarter to £5.1m.
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