Thu, 05 Dec 2024 | ADMINISTRATION
Inverness-based Caledonian Logistics has appointed administrators after being hit by challenging trading conditions.
The company, which employs around 130 staff and operated 80 trucks has been a member of the Palletways network since 2000. It was bought by Staffordshire-based group Drac Logistics in October 2022 and has depots in Inverness, Cumbernauld, Oldmeldrum and Kintore.
Glasgow-based accountancy firm Johnston Carmichael was appointed by Caledonian on November 28th. Joint administrators from the company are Donald McNaught and Graeme Bain.
Johnston Carmichael blamed the administration on a period of challenging trading.
“While the company had successfully cut costs and increased turnover, its return to profitability required ongoing funding by its parent company. The company recently attempted to sell the company or the underlying business and assets, but these efforts were unsuccessful and the company ceased trading prior to administration,” they reportedly said. “Fortunately, the large majority of jobs have been retained as a result of new operators picking up the routes the company serviced with the additional benefit of minimising the impact on customers.”
In Caledonian Logistics’ most recent annual results, for the year to 30 April 30 2022, its turnover rose to £15.2 million, up from just under £14 million the previous year. The company also made a pre-tax loss of £872,108, down from a pre-tax profit of £134,470.
At the time, its fixed assets were valued at around £3 million and current assets at £2.6 million, with net assets amounting to £206,433.
The road haulage sector has been hit by a number of challenges over the last few years such as rising fuel and vehicle prices and the cost of living crisis hitting consumer demand.
According to trade body The Road Haulage Association the average profit margin for businesses in the sector has fallen to as low as 2%. Nearly 500 hauliers went out of business in the UK 2023 with 2024 numbers also looking bleak.
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