Delivery firm DX Group reported slightly better-than-expected revenue in its preliminary annual results today, while at the same time bringing down its losses.
Shares climbed 6.5 per cent as the markets opened, complementing the business' nine per cent gain so far this year.
DX posted a total revenue of £299.5m in the financial year ending 30 June 2018, up from £291.9m in 2017. This was slightly ahead of market expectations, according to the firm.
Meanwhile it posted a loss of £4.9m to its earnings before interest, tax, depreciation, amortisation and exceptional items, coming off the back of a £7.2m profit the year before.
Why it's interesting
The positive growth in DX's results are signs that its turnaround plan is working, which was put in place after its freight business began to struggle.
Part of that strategy also included a switch-up in the business, having reorganised itself into two divisions of DX Freight and DX Express at the start of the financial year and restructured its balance sheet in May.
With significant growth being made in its logistics business, the firm hopes to return to overall profitable growth within the next three years.
What the company said
"This year has been one of significant change for DX. The Company is now on the road to recovery, as our turnaround initiatives start to gain traction," said Ron Series, chairman of DX Group.
"The Group's performance is slightly ahead of market expectations, with revenue modestly ahead and the underlying loss lower than we anticipated. This reflects the growth in our Logistics business and the initial benefits of our turnaround plan.
"We are encouraged by prospects for continuing progress over the new financial year, and retain our confidence in meeting both the short and long term goals we have set ourselves."
Trading conditions in the delivery business are proving tough at the moment, exemplified by Royal Mail's profit warning which sent its shares tumbling 17 per cent yesterday and a further seven per cent this morning. At a time when Amazon mostly dominates the parcel delivery market, DX's results are a much needed boost to UK industry.