A strong performance by its Parcel Freight division drove up half-year profits at Connect Group, the Swindon-based specialist distribution company.
Group pre-tax profits came in 36% higher at £19.2m on sales up 4.2% to £948.4m in the six months to the end of February. 
Revenues accelerated by 12% to £82.4m at Parcel Freight, formed when Connect Group acquired next-day delivery firm The Big Green Parcel Machine Holding Company in a deal worth more than £113m. The Big Green’s company principal subsidiary, Tuffnells Parcels Express, was the star performer, according to Connect.
However, the group, which split from WH Smith 10 years ago and was formerly known as Smiths News, reported a 2.1% fall in revenue from its core News & Media business, which delivers magazines and newspapers to newsagents and supermarkets.
But it said the newspaper and magazine market remained resilient, despite the recent closure of the Independent. This was reflected, it said, through a new five-year contract extension with Daily Express, Daily Star and OK! Magazine publisher Northern & Shell, announced at the same time as Connect’s financial results. This secured annualised sales of £83m.
While magazine sales dipped by 3.4%, this was an improvement on the decline of 8% three years ago while this summer’s Euro football tournament is expected to boost sales through special editions and sticker albums.
Growth in its book distribution division and education and care arm was flat but the group said e-commerce initiatives were helping it offset what remained challenging markets.
Group chief executive Mark Cashmore said: “The group has performed well in the first half, making pleasing progress with our strategic priorities. In particular, Parcel Freight has continued to deliver impressive revenue and profit growth, supported by the significant levels of new business secured in the period.”
