Unipart announces 2020 financial results

• Revenue in line with the previous year
• Strong cash generation
• Solid profit performance
• Best ever performance for the NHS
• Outstanding safety and environmental results
• New business and contract extensions add to growth

Despite unprecedented global challenges, Group turnover was broadly in line with the previous year at £786.7m (2019: £799.2m), resulting in underlying Group profit before interest and taxation slightly lower than the previous year at £16.1m (2019: £17.8m). Group profit before interest and taxation, defined benefit pensions, and other exceptional items, was lower than the previous year at £19.7m (2019: £27.3m), and the Group ended the year with net cash of £21.6m (2019: net debt of £11.0m) putting the business in a strong liquid position to invest in future growth.

Commenting on the results, Unipart Group Chairman and Chief Executive John Neill said:

“Our profitable performance in the face of the biggest upheaval to the global economy in generations illustrates that Unipart remains a highly responsive and agile business with a strong basis to consolidate and grow in the future.

“At the beginning of the year we set three challenges for the Group: to protect our people, to protect our processes, and to protect the flow of products and services for our customers.

“Our people responded with care and commitment, using the tools and techniques of The Unipart Way and our digital capability to scale up our operations to deliver essential services to all our customers. The NHS Supply Chain team delivered the best ever operational and safety performance despite the challenges of Covid.

“Unipart’s agility and capability were perhaps best demonstrated by our response to the Ventilator Challenge UK. MetLase, our joint venture with Rolls-Royce, and our Midlands factory created a working prototype ventilator, and commissioned a dedicated production line just 10 days from the Cabinet Office setting the challenge. Of the hundreds of companies to accept the challenge, MetLase was one of only five projects identified by the National Audit Office as being viable for production.

“Overall the business maintained strong performance throughout the uncertainties of the pandemic and the UK’s exit from the European Union, maintaining a strong cash reserve while continuing our commercial growth. With a tentative roadmap out of the pandemic now established, we look forward to leveraging our digital capability to further build on our future success.”

Business Growth

Despite unprecedented demand, in Unipart’s second year of managing the logistics operation for the NHS Supply Chain overall performance levels increased across the network, with the service levels to NHS Trusts being at a record high throughout the pandemic.

Furthermore, Unipart Logistics won a Supply Chain Excellence Award for successfully opening the new NHS Supply Chain Bury St Edmunds distribution centre on plan during the first national lockdown. Unipart’s use of digital twinning technology was a key element in enabling the site to open.

Early in the year Unipart Logistics announced a contract with Jaguar Land Rover to provide logistics services at its new Battery Assembly Centre in the West Midlands. This puts Unipart at the heart of Jaguar Land Rover’s electrification strategy.

Unipart Logistics extended its strong partnership with Kubota UK by a further five years. In the US, Unipart Logistics won a five-year contract extension with Pro:Direct Sports, the world’s largest online specialist sports retailer, with a planned 33% growth in warehouse and distribution services over the next period.

In October 2020, the Group acquired Comms Design Limited, a high-tech design and manufacturing company specialising in electronic products primarily for the rail industry.

During the year, Unipart Rail extended its agreement with VolkerRail to use Unipart’s premises for the Rail Electrification Alliance for the next four years. Unipart also renewed its framework contracts for Network Rail. Unipart renewed traction and rolling stock contracts with East Midlands Railway, Northern, and Arriva, and secured new business with Angel Trains, Hitachi and Stadler.

In North America, Unipart signed an agreement with Graham Construction for the future delivery of level crossings, building on work done in 2019. New equipment lines have been introduced with McCulloch Rail, whose innovative panel lifters technology is now being produced by Unipart Manufacturing Group in Coventry and exported to Unipart Rail’s global market.

Digital

Unipart has been an early adopter of the digital agenda and has built a suite of digital products and capabilities which provide competitive advantage for customers. To further facilitate this digital transformation, Unipart Technologies Group was established in 2020 to provide strategic, technical, operational, and commercial focus.

Comprising Instrumentel, MetLase, Park Signalling, Comms Design, the Institute of Advanced Manufacturing and Engineering, the Group’s IT operations and specialist digital team, Unipart Technologies Group will build on the broad and deep range of expertise and capabilities the Group has developed over many decades ranging from its skills in global enterprise systems, management, and support of complex client relationships and, more recently, digital and cybersecurity capabilities.

Covid-Secure

Unipart’s world class health, safety, and wellbeing management systems saw Covid-Secure measures implemented across our business well ahead of government guidelines last spring. During the British Safety Council annual audit later in the year, the auditor commented Unipart’s Covid-Secure safety was among the best they had seen.

Operational and functional teams worked together to create the Unipart Roadmap to Return, a playbook to responsively manage health and safety systems across every aspect of the business.

This collaboration and strong communications culture gained external recognition in November, when Unipart won a prestigious CovidComms Award for best in-house corporate communications response to the pandemic.

Environment and Safety

External auditors continued to endorse Unipart’s environmental credentials. Unipart Logistics won the British Safety Council Globe of Honour for the eighth year running after achieving a five-star rating in the environmental sustainability audit. Unipart Rail achieved a silver rating in its Ecovadis sustainability audit. The Carbon Assurance Trust verified Unipart Group’s ISO14064 carbon footprint standard for 2019.

Unipart is committed to sustainability and carbon neutrality by 2030, with initiatives in the business last year reducing carbon use by 20%, reducing water consumption by 10%, and achieving an overall recycling rate of 97%.

Furthermore, Unipart is dedicated to reducing single-use plastics and has worked with customers, suppliers, and partners to remove a total of 261 tonnes of single-use plastics from its logistics operations since 2018. In an example from the rail sector, Unipart Dorman removed 13km of single-use plastic in a year from the packaging used for the transit of LED signals.