DHL Container Logistics has reported a loss of almost for £3m last year, despite doubling turnover.
The logistics company blames an increasingly competitive market coupled with the economic downturn for its poor performance it admits that its market share now looks threatened. Sales grew to £70m in the year ending 31 December 2007, but 2006's pre-tax profit of £152,000 was converted into a loss of £2.7m. Operating loss fell from £371,000 to almost £2m during the period.
Although the company acknowledges that long-term forecasts for UK container volume growth are good, a global downturn has seen volumes fall and the high number of operators entering the sector has created a competitive trading environment.
In a bleak summary of the trading activities of and outlook for the Deutsche Post-owned business, the directors say: "The last five years have seen the market grow more competitive, a trend which is expected to continue and potentially threatens the company's market share.
"Due to the challenging market conditions, the business is exploring internal measures to improve efficiency and the utilisation of the business resources. The ongoing strategy of the business is to increase the flexibility of the cost base to allow the business to withstand the seasonal and economic fluctuations of the United Kingdom market."
However, its statement concludes that "niche growth opportunities" are being provided as the market develops.
According to DHL, Deutsche Post has confirmed it intends to provide the company with support "for at least one year after these financial statements are signed".
At the time of writing, a DHL spokesman was unable to confirm that a £12.3m loan from Deutsche Post during the period that was due to be repaid in September had been settled.
The logistics company blames an increasingly competitive market coupled with the economic downturn for its poor performance it admits that its market share now looks threatened. Sales grew to £70m in the year ending 31 December 2007, but 2006's pre-tax profit of £152,000 was converted into a loss of £2.7m. Operating loss fell from £371,000 to almost £2m during the period.
Although the company acknowledges that long-term forecasts for UK container volume growth are good, a global downturn has seen volumes fall and the high number of operators entering the sector has created a competitive trading environment.
In a bleak summary of the trading activities of and outlook for the Deutsche Post-owned business, the directors say: "The last five years have seen the market grow more competitive, a trend which is expected to continue and potentially threatens the company's market share.
"Due to the challenging market conditions, the business is exploring internal measures to improve efficiency and the utilisation of the business resources. The ongoing strategy of the business is to increase the flexibility of the cost base to allow the business to withstand the seasonal and economic fluctuations of the United Kingdom market."
However, its statement concludes that "niche growth opportunities" are being provided as the market develops.
According to DHL, Deutsche Post has confirmed it intends to provide the company with support "for at least one year after these financial statements are signed".
At the time of writing, a DHL spokesman was unable to confirm that a £12.3m loan from Deutsche Post during the period that was due to be repaid in September had been settled.