A Northern Ireland haulage firm has seen a 20% bump its profits – rising to £5.5m – amid a boost in post-Brexit business from the Republic of Ireland into the EU.
Hannon Transport saw pre-tax profits rise from £4.6m to £5.5m, according to accounts for Hannon Transport Limited, ending December 2023.
“Following Brexit, the business experienced an uplift in demand for transformation services along its Ireland to EU route as customers increasingly sourced their goods directly from the EU marketplace,” it says.
It says the vote to leave the EU created an “onerous” customs arrangement for trade between NI, the UK and EU.
In the wake of Brexit, it pivoted away from the UK trade side of the business, and set up its own customs team.
“The biggest problem has been on the UK side,” Aodh Hannon, managing director, previously told Ulster Business. “We would have been doing 20 trucks a day – a groupage, including flowers, plants, fruit and vegetables – mostly food. (Now – in 2021) we are down to zero.”
The business saw sales drop slightly from £65.1m to £60.8m in its latest published trading period.
“Sales volumes performed strongly in line with the prior year position,” it said.
Hannon Transport says the “strong volume performance” was due to a number of factors
“This customer trend continued along with increased demand from new sectors, during the period, which resulted in continued increased volumes,” it says.
“The business increased its export volume along its UK and EU routes to match the increased import demand.”
For the firm, Brexit meant two and half years of preparation, setting up new European depots, creating a dedicated customs team, and focusing efforts to mainland Europe, directly, or going through the Republic.
The business increased its gross margin during the trading period – from 17% to 24%.
In terms of the impact to the business, it says high-cost inflation continued to impact performance – however, it was less notable than in the previous year.
“The company’s focus on cost control, cost recovery, excellent levels of customer service and customer relationships along with improved performance of the company’s customs department, have contributed towards performance.”
The business says it is “confident” it will “continue to maintain and grow its current level of performance”.
It says it mitigated the risks posed by Brexit by creating its own in-house customs department which it says works closely with customers to ensure the “smooth movement of goods across multiple international borders”.