The Bestway Group has announced the financial results for the year ended 30 June 2010. The Group’s annual turnover increased by 2.6% to £2.10 billion from £2.05 billion in 2009. Profit before tax for the year ended 30 June 2010 was £72.01 million as compared to £80.64 million in 2009, a decrease of 10.7%. All businesses were profitable except Cement.
Mr Zameer Choudrey, the Group chief executive said, “The past year has been difficult and all our businesses have felt headwinds in the form of shifts in consumer trends as they respond to the changing economic and political environment. Despite this, however, the Group has managed to increase turnover and market share in its respective sectors.”
In June 2010, Bestway acquired Bellevue Cash & Carry Limited. Bellevue operates from two depots in Edinburgh & Stirling. Bestway has always felt that it has been under represented in Scotland, but with this acquisition, Bestway now has four depots there and feels that it can provide better service to customers and enhance market share in Scotland.
Turnover in the wholesale business amounted to £1.99 billion as compared to £1.92 billion in the corresponding period last year, an increase of 3.6%. Profit before tax increased to £46.3 million as compared to £39.9 million in 2009, an increase of 16.0%. Trading stock for the wholesale Group as at 30 June 2010 amounted to £202.5 million as compared to £182.9 million in the previous year, an increase of 10.7%.
Mr Choudrey said, “We remain focused on our mission of Building Business for the Independents. Our commitment to our customers is clearly demonstrated by the fact that we have the lowest prices and the widest product range in the wholesale sector.”
In November 2009, the newly developed central distribution warehouse at Coventry was opened. This has led to greater stock availability at all Bestway and Batleys depots and also increased efficiency of our internal distribution fleet. Subsequent to the year end, our new state of the art depot opened for trading in Aintree in the North West of England.
The Best One symbol group has entered the Scottish market on the back of the acquisition of Bellevue Cash & Carry and has been very well received by retailers. With Bellevue on board, customers will be better served.
The Bestway Group Retail Club operation has done very well during the year. The Xtra Local membership currently stands at 750 and the Best-in Club membership at 1,400.
Batleys’ specialised pet food range, “Bestpets” launched the new Bestpets Local Symbol group. The group allows the independent pet retailer to compete with the major multiples and has been designed to drive footfall, increase profits and raise the profile of the independent pet retailer. Since its launch in April 2010, the Group has had great success in customer recruitment and currently has 346 members.
For the year ending 30th June 2010 Bestway Cement Limited’s despatches increased to 4,944,440 tonnes from 3,673,538 tonnes in the corresponding period, a growth of 34.6%. This increase in volume was mainly due to the completion of the upgrade of Mustehkam Cement Limited from 1,000 tonnes to 3,450 tonnes per day. The new line is operating at well above the designed capacity.
United Bank Limited’s (UBL) total assets as at 31 December 2009 were $7.60 billion as compared to $7.37 billion for the corresponding period last year, which is an increase of 3.1%. UBL’s deposit base grew by 2.4% to $5.98 billion for the year to 31 December 2009. Total advances for the year were $4.30 billion, a decline of 4.2%.
The Group’s share in profit before tax was £36.6 million, as compared to £29.1 million in the corresponding period last year. Higher interest rates and a growth of 8% in interest earning assets resulted in an increase of 16% in net interest income which contributed towards the increase in UBL’s share of profit before tax.
OUTLOOK FOR 2011
Mr Choudrey said, “We see challenges ahead, both in the UK and in Pakistan as the respective economies go through an economic stabilisation phase. The UK, with its new government, has recently announced a number of austerity measures. Some of these have already been implemented whilst others are still in the pipeline. Of the ones that have been implemented, we have not yet seen the full impact on the economy especially on employment and consumer confidence which will directly affect our business.
“In Pakistan, the economy witnessed flash floods last year which have caused a great deal of destruction to the agrarian economy, rural demand and communication infrastructure. The GDP growth rate was revised down from 4.5% to 2.5% for 2011. The demand for cement is starting to pick up slowly as the rehabilitation process begins, however, there is still pressure on selling prices. Bestway continues to explore other export markets like Sri Lanka and Africa.
“United Bank Limited is well positioned to improve its performance in the short to medium term as the economy stabilises.
“In the last twelve months we have continued to demonstrate the strength of our business model and to create value for all our stakeholders. This has been accomplished with the continued support of our employees and our highly successful relationships with suppliers and customers.
“We are confident that we shall continue to enhance our market share both in UK in the wholesale sector and in Pakistan in the cement and banking sector.”