BLACK FRIDAY BLAMED FOR YODEL LOSSES

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Unprecedented demand on Black Friday and Cyber Monday has contributed to multimillion-pound losses at the business behind Yodel, although directors of the Liverpool-based parcel delivery group hailed "significant improvements in trading performance" across its Yodel and Arrow XL brands.

Yodel Distribution Holdings has posted earnings before interest, taxes, depreciation and amortisation (EBITDA) of £19.1m in the year ending 30 June 2015, down from £41.2m in the prior year. The figure does not include exceptional items but does include the share of profits from its Collect+ joint venture with PayPoint.

In a report accompanying the accounts, the board said: "The directors are pleased to report a £22m EBITDA improvement compared to the prior year, with both Yodel and Arrow XL reporting significant improvements in trading performance. The group remains committed to achieving customer excellence and aspires to please each and every customer, recognising that there are still improvements to be made to achieve this objective.

"Yodel reported an EBITDA loss for the year ended 2015, principally driven by unprecedented 'Black Friday' and 'Cyber Monday' volumes which caused significant operational stress and cost overruns. Yodel received significantly more parcels than clients had forecast over the Black Friday weekend alone and volumes continued to be above forecast in the following weeks as clients cleared down their backlog of orders.

"Yodel proactively and successfully worked with clients through that period to minimise the impact on customers. These issues were part of an industry-wide challenge as widely reported by the press at the time."

Yodel said that it handled a record-breaking 5.1 million parcels between 26 November and 2 December, which included Black Friday and Cyber Monday.

Meanwhile, Yodel Distribution Holdings posted pre-tax losses of £61.3m in 2014/15, which represents a narrowing of 29 per cent on the prior year.

Group turnover increased by 14 per cent to £504.7m over the same period. This does not take into account a further £23.2m generated from joint ventures, giving an overall total of £527.8m.

The board added that the EBITDA performance for both Yodel and Arrow XL was expected to show a further significant improvement in the year ending June 2016.

Yodel Distribution Holdings' ultimate controlling party is LW Corporation, which is controlled by Sir David Barclay and Sir Fredrick Barclay Family Settlements. The Barclay brothers have a string of business interests across the UK, including Speke-headquartered online retailer Shop Direct, The Daily Telegraph and The Sunday Telegraph.

In January, Yodel appointed Mike Cooper as its new chief executive. Prior to joining the business, he spent nine years at Arriva.