Rising costs for fleet replacement, higher employment taxes and operational challenges contributed to Gregory Trading Holdings posting a drop in annual profits despite higher turnover, writes Carol Millett.
The Devon-based logistics group includes Gregory Distribution, ARR Craib, John Mitchell (Grangemouth) and Pollock (Scotrans).
It saw pre-tax profit fall by a third to £6m in the 53 weeks to 4 October 2025, down from £9m the previous year, while revenue increased by £51m to £404.8m.
In its business review, the company said the additional trading week, alongside organic growth with existing customers, new contract wins secured in the previous year and the acquisition of John Mitchell (Grangemouth), had all contributed to higher turnover.
However, it said profitability came under pressure from a combination of rising costs and operational inefficiencies.
The group said it continued to experience “cost challenges across all spend categories”, including higher employer National Insurance contributions, significant increases in business rates and sharply higher vehicle costs.
It added that replacement trucks now cost up to 50% more than the vehicles they were replacing, while a nationwide shortage of skilled vehicle technicians had driven up maintenance costs.
Despite the lower pre-tax profit, earnings before interest, tax, depreciation and amortisation (EBITDA) rose 12.7% to £34.7m, which the group said reflected the underlying strength of the business.
The company also generated £33.5m in cash from operating activities, £4.1m higher than the previous year, while continuing to invest in new vehicles to support customer growth and new contract wins.
The group operates a large portion of its network in Scotland and, in March last year, strengthened its Scottish presence through the acquisition of John Mitchell (Grangemouth), a container haulage and warehousing specialist.
The business contributed £13.4m in turnover and £0.5m in profit after tax following the acquisition and will continue trading under its existing brand.
Looking ahead, the group said it had begun a major business transformation programme designed to improve long-term operational performance through changes to processes, technology and organisational structure.
