Logistics group Wincanton is expanding its eCommerce capacity to meet soaring demand as it continues to benefit from changes in shopping and distribution due to Covid-19.
The Chippenham-based group is to lease a 528,000 sq ft, state-of-the-art, automated eFulfilment facility in Northamptonshire – its second following the acquisition of one in Warwickshire last year.
In a fourth-quarter trading update to shareholders Wincanton said the new facility had already enabled it to secure business with DIY chain B&Q and sofa firm Snug, and there was a “healthy pipeline of further opportunities”.
The facility had been designed to deliver highly automated eFulfilment services to multiple clients, reducing unit costs and shortening lead-times in response to the rapidly changing demands of the consumer, it said.
Reflecting its continued growth since the start of the coronavirus pandemic, the group also said its underlying revenues for the quarter were up 15% year-on-year with a 40% increase its digital and eFulfilment.
As a result, it expects its full-year results to be above market expectations.
The group, which has a fleet of around 3,500 vehicles, employs 5,500 drivers and operates 14m sq ft of warehouse space across 200-plus UK locations, said as well high volumes in its existing eCommerce activities, the sector had been bolstered by new business for garden centre group Dobbies and furniture retailer Dwell and the launch of operations at its west London customer fulfilment centre (CFC) for supermarket group Waitrose.
Contracts covering Inland Border Clearance services and storing and distributing Covid-19 testing kits means its Public and Industrial business is expected to show year-on-year growth of around 10%, it said.
Performance in its Grocery and Consumer sector remained strong and was expected to grow by around 3% against a challenging year-on-year comparison – the final quarter of its 2019/2020 year coincided with panic buying during the early weeks of the pandemic.
The sector had secured a two-year contract with drinks group Heineken to handle products to retail outlets throughout England and Wales.
Growth in its General Merchandise business was expected to be up around 28% as it benefitted from higher demand during the recent lockdown, particularly for DIY products.
It secured a new three-year contract with garden landscaping products manufacturer Kelkay to provide a full transport service.
The group added that, as a result of its continued strong performance, it had repaid £5.8m of government support received under the Coronavirus Job Retention Scheme (CJRS), initially taken to protect jobs in its retained, closed book business.
Wincanton chief executive officer James Wroath said: “Wincanton has delivered another strong performance, maintaining our positive momentum throughout the final quarter of the year.
“Our people have met the challenges associated with operating in another lockdown and it is very satisfying to see all four parts of the business in growth and contributing positively to the group.
“We are also delighted to have expanded our eFulfilment capabilities and capacity further with our new site.
“This serves as a marker of our ambitions to capitalise on the growth opportunities presented by the increasing prominence of online retail.”
