NYK Logistics (UK) expects to be back in the black by the end of this financial year, after suffering a 38.5% fall in turnover and a pre-tax loss of £10.95m for the 12 months to 27 March 2010.
Deb Hardy, NYK finance director, tells Commercial Motor that the company was hit hard by the loss of its contract with Jaguar Land Rover (JLR) to DHL Supply Chain, which ceased in April 2009, and saw a large number of employees transferred to DHL under TUPE regulations.
Turnover tumbled to £196.9m from £320m in 2009, comprising a 37.6% fall in transport revenue to £125m, and a 40.7% drop in warehousing revenue to £57.7m.
Hardy explains: "We have made an onerous leasing provision in our warehousing portfolio of £8m, which contributed to a large proportion of the pre-tax loss. We have looked at what we think the future market requirements will be for us, and what we needed to change. We have had support from our parent for this."
Pre-tax losses increased by over £7m from the reported pre-tax loss of £3.39m for the 12 months to 28 March 2009.
The firm says sales decreased on the international freight forward-ing business, due to the worldwide reduction in shipping charges, and lower activity levels due to the economic climate.
As part of a restructuring exercise and the loss of JLR contract, the workforce was cut by 40% to 1,858 employees. The number of operational staff was reduced to 1,645 from 2,801 the previous year, while the number of operational management jobs fell to 55 from 99. However, the company won some new contracts during the period, including a renewal with Samsung Electronics and a warehousing deal for pharmaceutical firm Ranbaxy Laboratories.
The directors' report states that the accounts have been prepared on a going concern basis.
The report also reveals that the UK integration of NYK Logistics and Yusen Air & Sea Service is expected to be completed by 1 April 2011. "This, in addition, to the support of NYK Group, gives the company a solid foundation for long-term success," the report adds.
Deb Hardy, NYK finance director, tells Commercial Motor that the company was hit hard by the loss of its contract with Jaguar Land Rover (JLR) to DHL Supply Chain, which ceased in April 2009, and saw a large number of employees transferred to DHL under TUPE regulations.
Turnover tumbled to £196.9m from £320m in 2009, comprising a 37.6% fall in transport revenue to £125m, and a 40.7% drop in warehousing revenue to £57.7m.
Hardy explains: "We have made an onerous leasing provision in our warehousing portfolio of £8m, which contributed to a large proportion of the pre-tax loss. We have looked at what we think the future market requirements will be for us, and what we needed to change. We have had support from our parent for this."
Pre-tax losses increased by over £7m from the reported pre-tax loss of £3.39m for the 12 months to 28 March 2009.
The firm says sales decreased on the international freight forward-ing business, due to the worldwide reduction in shipping charges, and lower activity levels due to the economic climate.
As part of a restructuring exercise and the loss of JLR contract, the workforce was cut by 40% to 1,858 employees. The number of operational staff was reduced to 1,645 from 2,801 the previous year, while the number of operational management jobs fell to 55 from 99. However, the company won some new contracts during the period, including a renewal with Samsung Electronics and a warehousing deal for pharmaceutical firm Ranbaxy Laboratories.
The directors' report states that the accounts have been prepared on a going concern basis.
The report also reveals that the UK integration of NYK Logistics and Yusen Air & Sea Service is expected to be completed by 1 April 2011. "This, in addition, to the support of NYK Group, gives the company a solid foundation for long-term success," the report adds.