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The UK’s Clipper Logistics enhanced its credentials as a specialist logistics provider to e-commerce retailers yesterday, reporting double-digit growth in sales and profits for its e-fulfillment services.

Yesterday it presented its first full-year results after last year’s listing on the London Stock Exchange, and reported a 31.5% growth in e-fulfillment revenue to £60.6m. Earnings before interest and tax (EBIT) grew 48% to £5.5m, on activities that “include the receipt, warehousing, stock management, picking, packing and despatch of products on behalf of customers to support their online trading activities, as well as a range of ancillary support services including returns management”.

Chairman and chief executive Steve Parkin said: “Our driving force remains our ethos of constantly identifying new services, methods and technologies that address the operational challenges of our clients.

“Our unrivalled understanding of the e-fulfillment and returns market, coupled with our clients’ continually evolving needs in these areas, will ensure that we retain and expand our market share.”

Clipper’s traditional logistics services, mainly for the retail sector, also saw strong growth – with revenue up 14.1% to £102.1m and EBIT up 9.8% to £10.1m.

The year saw a number of new contract wins with among others Pep&Co, Philip Morris and Zara, while New Look, Harvey Nichols and Tesco all signed contract extensions – the latter two by 10 years and five years respectively.

December saw the £5.7m acquisition of Servicecare, a UK company dedicated to returns for the electronics sector, which Clipper said gave it a good pipeline for 2015 with existing clients that include Argos, Panasonic, Shop Direct Group and Tefal.

However, it is servicing the complex business-to-consumer, and the even more complex area of returns of unwanted goods, that are expected to drive the business.

“The growth of online retailing and the desire for major retail brands to have as many different touch points with their customers as possible means that multichannel retailing will be a dynamic driver of change for both the retail and logistics markets in the near future,” said the company. “An increasing number of distribution channels are now required to meet the demands of the consumer, including shopping at stores, home delivery, click and collect as well as the return of purchased items.”

Online retail association IMRG has calculated that e-commerce sales in the UK amounted to £104bn last year, up from just £800m in 2001.

Two elements are likely to be critical to Clipper’s progress in 2015:  its attempts to expand into the European market, which is now converting from traditional retail to e-tail as fast as the UK market; and how efficiently it can execute its returns logistics operations, which it now markets as the Boomerang service.

In a presentation to investors yesterday, Clipper said customer returns in the fashion and clothing sector now accounted for the single largest source of inbound stock to retailers warehouses, indicating that it had become an issue on which entire businesses could succeed or fail.

Meanwhile, Clipper’s fortunes beyond the UK this year will likely rest on the contract it recently won with “Ireland’s biggest retailer”, which it declined to name, although recent reports have said that the SuperValu group recently rose above Tesco to take the number one spot.

In mainland Europe last year, the group won a contract to handle returns logistics for s.Oliver from centres in Münchberg and Hof – a contract win that “aligns with our clear strategy to develop returns management capabilities in continental Europe to capitalise on our strengths in this key area”, it said.

Total Clipper Group revenues increased by 16.7% to £234.8m, and adjusted EBIT increased by 24.9% to reach £12.0m.

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