FAMILY firm J.R. Rix & Sons grew its turnover by 16 per cent to £494m in its last financial year, boosted by its fuel distribution business, but profits dipped against a difficult economic backdrop.
The Hull-based group, which started out as ship owners in 1870 and diversified into fuel distribution, shipping, motor cars, caravan manufacturing and property, saw overall pre-tax profit drop to £1.7m in the year to the end of December 2012, down from £2.3m in 2011.
Rix Petroleum, the biggest company in the group, increased sales over the year to £391.7m from £317.8m in 2011. It distributes commercial diesel, farm fuels and residential heating oil from depots across Yorkshire, Lincolnshire, Norfolk, the West Midlands, Shropshire, the North East and Scotland.
Rory Clarke, managing director of Rix Petroleum and group board member, said the company had experienced a challenging year but was pleased with the performance.
Mr Clarke said: “Given the state of the UK economy and Europe generally, we were operating in difficult circumstances and are therefore pleased with the results we achieved.
“Rix Petroleum saw a significant increase in revenue through winning new and replacement business and monitoring customer relations regularly. The company continues to expand its area of operation.”
He said that oil prices fluctuated during the year by as much as plus eight per cent to minus ten per cent, but they finished the end of the year at almost exactly the same price that they started, so overall their influence on the turnover for the year would have been “broadly natural”.
Mr Clarke expects turnover at fuel card business Fuelmate, which is included in Rix Petroleum’s figures, to double over a two-year period. Last year, it recorded a figure of £25m, up 15 per cent on the previous year.
Mr Clarke said that the overall dip in the group’s proftability was as the result of “a tough year”. “Parts of our business struggled last year and parts of the business have performed okay.
“The first half of the year was very difficult, very challenging.”
He added: “I think that on our shipping side reduced imports and exports through the ports of Hull, at least the ones that we’re involved with, meant there was less work for our shipping business.
“We built a new ship which started trading and we have to build up a level of work, so higher costs, at the same time as a drop in business. So investment in new assets and no opportunity really to get those assets fully developed in terms of trading.”
The group’s shipping business saw turnover drop to £5.3m last year from £9.6m in 2011.
The Marine Bunkering division, which supplies marine fuels to shipping vessels, saw a small increase in revenue from £74.7m in 2011 to £75m last year. However, profitability was affected by product availability, the company said. Car retailer Jordans grew sales by £1.3m to reach £11.9m in the year to the end of 2012.
Meanwhile, the group’s static caravans business recorded sales of £10.2m, down from £10.9m in 2011. Mr Clarke said: “Jordans traded in line with expectations in what has been a difficult period for the new and used car market.
“However, the full effects of the Fiat Super Centre, which saw new marques brought on stream and the Witham showroom refurbished, were felt.”
He said that included in the 2012 figures was an investment in the company’s first wind farm work boat, which will be used to carry engineers and equipment to and from offshore wind farms in the North Sea.
“This work boat is the first of several that we are investing in to enable us to take advantage of the significant opportunities that the development of offshore wind creates for the Humber region,” he said.
“We see this as a natural fit for the business and a serious area of growth as we have owned and operated ships in these waters and beyond for more than 140 years.”
Commenting on trading so far this year, Mr Clarke said: “On the car side we’ve seen increased turnover although unit profitability is slightly down.
“On the fuel side trading has been very good this year, certainly helped by a long, cold winter. The static caravans side is quite challenging at the moment.”
J.R Rix & Sons employs around 400 people across the group, which is down slightly on last year.
Mr Clarke said: “We came out of dry cargo ships just over a year ago... and we also came out of operating our own shipyard, Hepworths, so that is the difference in the employees.”
He said that the group is currently in the process of taking on some apprentices.