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Rising costs hit Knowles profit
Page 17
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High-profile East Anglian opera tor Knowles Transport has had a reasonable year but faces VVTD
costs. Guy Sheppard reports.
WAREHOUSING and distribution operator Knowles (Transport) boosted its turnover by more than £2m last year but failed to convert this into increased profits.
Ian Ramsay. general manager of the Cambridgeshire-based firm, blames sharply rising fuel costs for holding its pre-tax profits at £2.1m.
"Fuel prices are going up considerably and it takes time to adjust to that," he adds.
Like most other large and medium-sized hauliers, Knowles has fuel escalator clauses in its contracts but these take time to feed through to the accounts. Ramsay explains: "Generally speaking. we've been firm in reflecting cost increases to our major customers."
The number of employee', remained virtually unchanged a t 136 in 2004, even though turnover jumped by nearly 11% to i21.9m.
Ramsay says the Working Time Directive and the need to retain good drivers means this year's accounts will be affected by a significant increase in labour costs: "We've had to improve our packages for our key people. Most of the increases we put through were effective from the beginning of this year."
He concludes that the outlook for the company remains good: "We have a very strong financial base, a very good customer base and a very good group of employees.