Christian Salvesen claims the performance of its UK logistics business for the first half of the year will be hit by the poor summer weather. The company's first interim management statement, released last week, says the wet conditions in Britain have "severely affected" crops. It adds: "As part of our continuing UK logistics business, we process and store frozen vegetables for customers at sites in Grimsby, Hull and Lowestoft. During July, this part of the business felt the first impact of lower volumes and this will impact the first-half financial performance for UK Logistics. Looking forward, storage volumes of these products are also likely to be lower than expected during the remainder of the finan-cial year."
Salvesen has also announced it is selling its frozen-pea processing, packing and storage business at Bourne, North Thoresby and Easton in Lincolnshire to Pinguin Foods UK for £17.2m. Stewart Oades, Christian Salvesen chief executive, says: "This disposal marks another important step in our strategy of refocusing around our core activities of logistics and transport."
In June, Salvesen announced measures to increase productivity, improve its fleet, modify its pricing and invest in new purpose-built sites. This followed a drop in pre-tax profit from £15.4m in 2006 to £12.5m for the year to March 2007. Salvesen's interim management statement adds: "The UK Transport recovery plan is underway, although as expected, we do not expect to see significant financial benefit until the second half." The company says its businesses have traded broadly in line with expectations, "which are weighted towards the second half of the fin-ancial year".
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