News

Norbert Dentressangle (ND) says it will cut its UK transport fleet by 20% – around 150 vehicles – during 2009, as it boosts network efficiency at the former Christian Salvesen business.

Its 2008 results, released earlier this week, show a fall in operating profit of 7% across the  entire transport division, which it blames on the "very poor performance of the Salvesen transport activities in the UK", coupled with restructuring costs in the UK, and the economic downturn in the last quarter of 2008.

Hervé Montjotin, head of ND's transport division and executive vice-president for ND Group, says the UK transport business had been loss-making for the past seven years. ND has now appointed a new management team, headed by Stephen MacDonald, who formerly ran Salvesen's Spanish business, Geposa, and believes that efficiency gains and network improvements will see it break even by 2010.

"The first two months [of 2009] are rather encouraging – they show good results for what we have implemented and at the same time we have had significant commercial success in the division."

He says that although the 20% fleet cut – described as a "rolling programme" through the year – will also mean a reduction in headcount, there are no plans for  any further depot closures. ND shut three sites across the South and Wales last year, and the associated restructuring costs contributed to about one third of the losses in the UK, says Montjotin. Providing that business levels don't fall further, he says that these costs are unlikely to recur in 2009.

The company cut 1,500 jobs and 800 trucks from its entire transport division last year as it looked to cope with a market that has fallen by around 20%. Montjotin explains: "That is a huge fall for a low-margin business. But at the same time there are a lot of opportunities as customers look to make savings."

Overall, consolidated revenue was €3.1bn, a rise of 72% (4.3% excluding the Salvesen business). Operating profit stood at €78.9m, a margin of 2.5%.