T&B's growing international success leaves the Uk behind

TIBBETT & Britten has ‘crossed the Rubicon’ in being a UK-headquartered logistics company whose home base now accounts for just 39% of group revenues, down from 96% a decade ago.

The man behind this change is not Caesar, but T&B chairman John Harvey, whose shock of white hair and distinctive spectacles has been the face of UK logistics for 20 years.

He may have recently relinquished the dual role of chief executive, but Mr Harvey remains an imposing force at T&B until ‘the Good Lord, our shareholders or my wife decide otherwise’.

At last week’s half-year results, the bullet points were: * A pre-tax loss of Pounds 23.4m (Dollars 33.8m) on a group turnover of Pounds 686.1m as T&B took a one-off Pounds 38.2m hit from the sale of car distribution business Axial;

* a 28% rise in North American revenue and operating profit; * a slight downturn in the UK due to C&A axeing its stores and T&B withdrawing from shared-user operations;

* Good progress in mainland Europe and other overseas markets; * Guaranteed new contracts in the pipeline across all regions for the higher turnover second half;

* Pounds 150m debt capacity to fund future acquisitions. Stripped of exceptionals and other items, the baseline operating profit saw a 9.9% growth from Pounds 12.2m to Pounds 13.4m.

Said Mr Harvey: ‘We have sustained the growth of the past 15 years in Europe and North America. We have crossed the Rubicon in that the UK is now a minor part of our business.’ He added: ‘The North American growth has been, and remains, very strong. This is partly because we are insulated from the high-tech meltdown.

‘We have rigorously stuck to our focus on consumer goods, retail and merchandising, to the point where the North American business is now 43% of revenue and 45% of our operating profit.’ He added: ‘The one market where we did not progress was the UK where we saw a 4% diminution year on year.

‘It had a lot to do with deferred decisions. It has been a very turbulent time in the retail trade, with mergers and demergers: Sainsbury and Homebase, Kingfisher and Woolworths, Booker and Iceland. All these affect us.’ The growth of the Americas business, now at Pounds 291.9m turnover for the half year, is an obvious cause of pride for Mr Harvey.

‘It has given us a balanced portfolio in terms of currency and economies, because we now have two home markets: Europe and North America, accounting for over 95% of our sales. UK is an offshore island which is part of Europe.’ The North American business is now split 55% in the US and 45% in Canada, with a very small Argentinian operation.

Added Mr Harvey: ‘We started in Canada ten years ago and have not bought a single business out there. It was created entirely organically.

‘We built that business over a decade, and for six years the analysts were telling us to shut it. But we built it and extended it, so we can’t stop crowing about it.

‘North America now employs 13,000 people, and the business has been in profit for the last four years.’ The philosophy of organic growth, strategic alliances with giants like Gulf Agency Company and Hutchison Whampoa, plus small-scale selected niche acquisitions, is the recognisable Harvey touch.

On mainland Europe, he observed: ‘One of the biggest problems for a UK operator, the likes of Hays, Salvesen, Exel and ourselves, is digging into someone else’s home market.

‘We are now working for 80% of the French grocery market and are probably one of the largest contractors in France. It has taken three or four years to get there in France, and in the same sort of position in Spain.’ Although T&B admits to ‘lacking critical mass in Germany and Benelux’, there will be no rush to spend the Pounds 150m war chest for acquisitions.

‘We have got the money to buy substantial businesses. But we will find ones that reinforce our domestic businesses in the Americas and Europe. We are not in a hurry.’ If there was a fly in the T&B ointment, other than Axial,