Hargreaves, based in Esh Winning, are the UK leading fuel and logistics group. In the 12 months ended May 31, 2016 the company saw continuing revenue tumble by nearly half to £340.7m, compared to £662.2m the previous year. Continuing operating profit also plummeted by over 86% to £5.2m.
The key difficulty has been a massive reduction in its solid fuel business. Over the last two years production has fell to 2 million tonnes from 7 million tonnes per year. This has resulted in the company diversifying, restructuring and reducing coal production to ensure long-term value for shareholders.
The company maintains it has a new strategy focussing more on industrial services. Gordon Banham, chief executive, said: “Our focus has been to reduce exposure to thermal coal and power station closures, and continuing falls in prices and demand have hastened scaling-down of operations.
“However, we have started to see the benefits materialise from two years of restructuring and have three businesses complementing coal distribution.
“Our heritage in coal production left us with skills and equipment necessary to undertake contract mining and earthworks and the acquisition of Blackwell establishes a new specialist earthworks division.”
Over the next five to seven years, however, the group is focussed and hopeful of generating between £35m and £50m of incremental value. This will be from its property and energy project portfolio, as it continues to reduce its focus on thermal coal and offer services to customers through its industrial services and logistics divisions.