Delivery group DX on 'road to recovery' after nightmare year

Pre-tax losses soared to £82.3m as problems grew within the business, leading to a boardroom clear-out. But losses for the last year have been cut to £19.9m as DX drives ahead with its turnaround plan and a new leadership team.

Unveiling results for the 12 months to the end of June, DX said revenue was ahead of expectations, at £299.5m, up slightly on last year.

The initial focus of the company's turnaround initiatives has been on the loss-making DX Freight business, improving productivity at hubs like its operation at Willenhall, where it employs around 500 people.

The company has already underlined its commitment to the future of the hub – split across two depots at Crestwood House in Birches Rise and Ashmore Lake Way – after fears were raised for its future following the collapse of DX's plans to replace it with a £35m super-hub in Essington in 2016.

DX also reopened a depot in Cannock over the last year and another in South Gloucestershire.

Chairman Ron Series said: "This year has been one of significant change for DX. The company is now on the road to recovery, as our turnaround initiatives start to gain traction.

"The group's performance is slightly ahead of market expectations, with revenue modestly ahead and the underlying loss lower than we anticipated. This reflects the growth in our logistics business and the initial benefits of our turnaround plan.

"We are encouraged by prospects for continuing progress over the new financial year, and retain our confidence in meeting both the short and long term goals we have set ourselves."

The new management team has the backing of major investors such as Gatemore Capital Management, which supported a £24m funding injection last year.

Liad Meidar, managing partner and chief investment officer at Gatemore, said today: “We are pleased to see that the team we installed is executing the turnaround ahead of plan on nearly every metric.

"Having taken the reins only at the end of the first half, new management was able to dramatically stem losses in the second half. They have also indicated a strong start to the new fiscal year.

"We are excited about the prospects for the business and look forward to supporting the company further over the long term.”