FERGUSSON, one of Britain's largest coal retailers, tripled its profit last year despite a downturn in its property business and the end of a large low-margin contract that resulted in a 5 per cent reduction in turnover.
The Stirling-based company, established in 1926 by the current owners' grandfather, made a pre-tax profit of £2.7 million in the year to 31 March, 2008, up from £833,455 a year earlier, despite turnover dropping 5.5 per cent to £55m.
Already one
of the leading coal retailers in the UK, Fergusson said yesterday that it had bought another five retailers across Scotland during the year, bringing the total number of coal merchants bought by the company to 60 during the past two decades.
Fergusson said it had also continued to invest in its existing assets, spending more than £1m on plant and equipment for its processing plant at the Hunterston deep water terminal in Ayrshire, on which it recently secured on an extended 15-year lease.
Opened in 2000, the facility imports and exports coal, and has been one of the chief growth drivers for the group.
A further £400,000 has been invested in new machinery for the group's pre-pack division, which sells coal in sacks mainly for domestic customers.
In a written statement issued yesterday, the group blamed a fall in total turnover on the conclusion of a "long-term low-margin contract" during the financial year, adding that there was also a reduction in activity in its property venture.
On the tripling in profits, the group said it had increased work in specialised markets such as pre-packed coal, while the end of low-margin contracts had improved group margins.
A statement from brothers Tom and Alan Fergusson, who jointly own the group, read: "These are strong results which reflect our strategy of diversifying the business into new market sectors."
The company denied that the domestic coal market was in decline, saying it had shown a marked increase over the past two years, with more households looking at solid fuel positively. "This trend is expected to continue and Fergusson Group as a company is focusing on a committed plan to manage and maintain this market," the brothers said.
They added: "Fergusson Group has secured a record order book to supply 2.5 million tonnes of coal across all of its supply sectors."
The company was founded in 1926 when the original Thomas Fergusson began selling coal door to door by horse and cart around Stirling.
It now operates from 11 main depots across Scotland and has more than 200 staff, supplying domestic customers as well as the power, alloy metals and paper industries.
