New Brexit rules could give freight firm a lift

WHEN 63-year-old accountant Stephen Blyth founded the freight management company Xpediator 30 years ago, he had just one customer.

Today, there are almost 15,000 – from giants such as Amazon to small, local firms in Romania or Malta.

Xpediator helps these businesses to transport goods efficiently and costeffectively, mostly within Europe but also further afield, from countries such as China and the US.

It floated on Aim in August 2017, the shares are 64½p and should increase substantially from here. Blyth, the firm’s chief executive, is extremely experienced, highly ambitious and has amassed a loyal and driven team around him.

Importantly too, Xpediator does not own trucks and transport facilities. Instead, it takes charge of arrangements involved in moving freight around, from leasing lorries and drivers to making sure that paperwork is in order.

As such, the company is one of the few British businesses to say publicly that it is likely to benefit from Brexit as the more complicated import and export rules become, the more UK and European firms will need the services of an expert freight manager.

Blyth initially focused on road transport, in particular taking goods to and from Eastern Europe. It now offers air and sea freight management and provides 1,700 truck owners with services such as fuel cards and insurance, using its buying power to offer them better prices.

A recently acquired business, Regional Express, helps small American firms on Amazon to sell goods into Europe.

And Blyth has launched an e-commerce service of his own, EshopWedrop, which allows consumers in countries such as Estonia, Lithuania and Albania to buy online goods from abroad at extremely competitive prices. Products include nappies and crash helmets, which are exempt from VAT in Britain but subject to the tax in certain parts of the Baltics, and the business is growing fast.

When Xpediator floated, Blyth’s stated intention was to make strategic acquisitions. Four have been made already and more are on the cards.

Blyth’s accounting nous – and that of his finance director, another qualified accountant – have proved useful with these deals, which are structured to reward long-term performance but penalise underperformance. One acquisition, for example, faced issues with Chinese importers and has agreed to pay back some of the money it received when it was bought last year.

Interim results, released last week, showed a 60 per cent increase in revenues to £79 million with profits soaring 132 per cent to £2.3 million and a chunky 21 per cent increase in the half-year dividend to 0.42p.

Brokers expect full-year revenues of £172 million with profits of £7 million and a dividend of 1.5p. Blyth is incentivised to succeed as his family owns 26 per cent of the company.