Acquisitions and new depots hit Bestway profits but sales soar
Bestway’s wholesale business has reported a healthy increase in sales, but integration costs and investment in new depots have taken their toll on pre-tax profits.
The wholesaler said its sales had risen 5.7% to £2.3bn in the year to 30 June 2012, but that pre-tax profits had dipped 3.3% to £58.2m.
Profits had been hit by the “ongoing impact of the overall economic environment”, the opening of new depots in Brighton in November 2011 and Team Valley in May 2012 and integration costs associated with its acquisitions of Bellevue and Martex in 2010, said Group CEO Zameer Choudrey.
Sales, however, had been buoyant. Own-label sales leapt 14.1% to £103m thanks to the launch of the Best-in Essential range of 34 value lines, while export sales jumped 26%.
Bestway’s transactional website, launched last May, was currently averaging sales of £2.5m a week, added Choudrey.
“The focus of the group’s wholesale business on organic growth is supported by investments in existing and new depots and initiatives,” he said. “Despite the tough trading conditions, we are confident we will continue to provide maximum support to our customers by delivering the best prices, value and service.”
Bestway, which also owns banking and cement interests, saw its group pre-tax profits rise 45.5% to £173.2m on sales up 6.8% to £2.5bn. Bestway said it had also reduced its total loans and overdrafts by £75.4m - reducing debt by £30m in the UK and by £45.4m in Pakistan.