Online delivered wholesaler Blueheath boosted turnover 12% to £70.2m in the year to February 26 and is set to break even this year after significant expansion since its year end.
In its first results since it floated on AIM in July last year it reported a pre-tax loss of £6.2m after distribution costs of £5m and administration costs of £4m wiped out a gross profit on sales of £4.1m.
However, chief executive Douglas Gurr said expansion of the business would bring economies of scale and greater buying power and this would help the company to cover its costs. He ponted out margins improved from 5% last year to 5.9%. The company’s broker, Evolution, predicted Blueheath would break even before the end of its current financial year.
Coinciding with the results the company said it had two new business wins and it released the identities of three out of the four business wins it announced in early March.
Forecourt group Park Garages (a member of The Grocer Top 50 of independent stores) was one of the three names released, together with leisure operator PGL and Intervend, Blueheath’s first foodservice operator.
New account wins were with forecourt retailer Highway Stops and leisure operator Gala Casinos.
Blueheath said it also had eight accounts at trial or tender stage with a combined value of £90m, and on average 30%-40% of such prospects were realised. More than 50% of its business is now with multiples.
Blueheath also revealed that it paid £3.9m, with an additional £1m depending on a number of factors, when it bought Wrexham-based wholesaler CTM last month.
Gurr said the company was in a position to make other acquisitions if suitable opportunities arose, but said Blueheath was not interested in owning property (the freehold of the CTM depot was not included in the deal).
He said the integration of CTM was going well and he expected Blueheath’s IT would enable stock holding to be reduced from 23-31 days down to 10, although this was still significantly higher than the rest of the company which averaged 5.8 last year.