Initiation: Focus on the core to pay dividends
The disposal of Records Management is effectively the end of the current phase of restructuring, with net debt reduced from a peak of £270m to £45m in FY16e and Wincanton now back on the front foot. A programme of continuous improvements has increased the resilience of the core UK logistics business with improved margins and profits. Despite its market leadership the rating remains at a discount to its global peers and our valuation range (219-242p). Another potential catalyst is the resumption of dividends.Wincanton provides logistics and supply chain solutions. Co.'s segments are: Retail & Consumer, which include retail general merchandise, retail grocery and consumer products; and Industrial & Transport, which include transport services, construction and other. Co.'s retail & consumer operations manage the flow of goods from production through to delivery to the store or home. Co.'s industrial & transport operations handle a range of industrial products through a network. The products are as diverse as fuel, bricks and engineering components alongside the transport of containers and general goods. It also includes the maintenance of large goods vehicles and heavy goods vehicles.
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