Profit leap for Nightfreight
Overnight freight and parcels courier Nightfreight managed a 32% increase in profit on the back of sales that were only 13.7% higher in 2001.
The figures, achieved in a highly competitive market place, suggest that the company’s management, who led an MBO early last year, were on the right lines with their subsequent restructuring of the business. And independent research has shown that Nightfreight now has the biggest share of the UK mixed parcels and IDW (irregular dimension and weight) market.
CEO Robert Kelly, who led the Barclays-backed MBO, said: “We recognise there is still a long way to go but by freeing ourselves from the shackles of a plc, we have made impressive strides over the past 12 months.
“Rather than aiming to be a conventional carrier providing overnight deliveries of traditional square packages, we have successfully refocused the business to become the leading player in a distinct market niche, the mixed parcels and IDW freight sector.” The MBO plan was to restructure the group around two core divisions – freight/parcels and logistics – while the lossmaking forwarding division was sold.
Most carriers have highly automated handling systems which can manage small packages but not awkward freight.
Making a virtue out of a seeming weakness, Nightfreight’s three hubs and 50 depots combine limited automation with manual handling sortation. This allows customers with a mix of documents, parcels and IDW freight to put all their business with the company rather than splitting their parcel and freight deliveries between carriers as they are often forced to do.
The freight/parcels division saw consignment values grow by 12.7% in 2001 as Nightfreight increased its market share. International growth is outpacing domestic following the setting up of a European Gateway collection and delivery service.
Two operations in the logistics division, Pacemaker and network logistics, have won new contracts and gained extra business from existing customers.
Pacemaker provides specialised handling and two-person delivery of IDW products, such as furniture and vending machines.
This service includes installation, removal and scrapping of old products, repair, replenishment and on-site training.
Nightfreight’s network logistics service, under contract, combines group network delivery capabilities with additional fulfilment services including dedicated transport, warehousing, stock control, call centres and e-commerce facilities.
The company has backed its restructure with a new image encompassing vehicle livery, branch signage, printed material and interior design for the entire hub and depot network.
Concluded Kelly: “The strategy is right. The restructuring is almost complete. The new image reflects our vision for the future. Our 2001 performance has exceeded both our and our backers’ expectations. Service quality is improving and customers continue to respond favourably to our initiatives.”
