AYRSHIRE company Maxi Group has revealed stockpiling in anticipation of Brexit pushed its haulage business between Great Britain and Ireland “completely out of balance” with “totally uneconomic” traffic flows

The construction and haulage group, unveiling record turnover and a jump in profits for the 12 months to last September, said the adverse effects of Brexit anticipation in late-2018 and early-2019, and steps to resolve the situation, would affect turnover and margin in the current financial year.

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Irvine-based Maxi, which employs about 380 people and has a fleet of 154 trucks and 680 trailers, has this week unveiled a 58 per cent jump in pre-tax profits to £2.52 million in the year to September on the back of a 14% rise in turnover to £85.1m.

Maxi said: “Late-2018, because of the adverse effects of Brexit anticipation, we experienced some issues with our Irish business. The need to maintain customer service levels during inefficient, out-of-balance traffic flows was totally uneconomic.”

Owner and chairman Gerry Atkinson, who has been with Maxi since 1977 and bought out the other shareholders in 1983, noted this situation had not settled down until into February. He noted that the haulage division had during the affected period been transporting about twice as much westwards to Ireland as was coming back eastwards.

Mr Atkinson revealed the building-up of stocks had occurred mostly in the Republic of Ireland but noted there had also been such activity in Northern Ireland, as companies anticipated Brexit.

He said: “Going west, they were stocking up on everything. It was customers in the supermarket business, the food business, the toiletries. They were stocking up on everything – consumer products generally.

“Not so much white goods and so on, but more groceries and household products.”

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Mr Atkinson noted some commercial ventures had been stocking up on raw materials.

He said: “The problem is the Irish business got completely out of balance with a huge amount of west-going traffic, nothing going back. It has really cost us a fortune. We had to carry on giving our customers a service, which was at great cost with nothing coming back.

“This year, we have dropped a lot of westbound contracts.”

He added: “Everybody has stocked up. We don’t know what is going to happen.”

Mr Atkinson, who noted Maxi’s haulage business currently undertook a total of about 1,000 movements to and from Ireland each week, added: “We have cut back on some east-west traffic to get things back in balance.”

Profit in Maxi’s haulage business rose from £1.35m to £1.9m in the year to last September on a rise in turnover from £62.3m to £66.3m.

Maxi’s construction business achieved a jump in profits from £353,000 to around £600,000 on the back of a rise in turnover from £11.4m to more than £18m.

Mr Atkinson noted the group also includes a warehousing and construction management business.

He projects profits in haulage will be down over this financial year as a whole as a result of the issues in the Irish business. Turnover from the haulage business to and from Ireland would be about £2m lower, he observed, he noted, but this fall would be offset by new work. He expects overall haulage turnover to be broadly unchanged in the current financial year from the prior 12 months.

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Mr Atkinson highlighted a current £1.25m refurbishment of Maxi’s haulage depot at Bellshill.

He noted the construction business, which serves central and southern Scotland and has been appointed to numerous local authority frameworks, was “about the same as last year turnover and profit-wise”.

Mr Atkinson said: “I am delighted with the performance of the group companies over the latest financial period and although there are challenges to meet, particularly in the haulage industry, we are on track to achieve our targets for the current financial year.”

He added that the national shortage of drivers of heavy goods vehicles was an “ongoing issue” within the haulage industry.

Maxi has “introduced further initiatives to assist with driver recruitment and retention”.

He said of the haulage business: “The profit will be reduced. We still don’t know what is happening with Brexit so I don’t want to make a prediction. We are on an even keel now. We are trading profitably.”

Referring to the extension of the Brexit deadline to October 31, he added: “Whether that will get better or worse because of what will happen between now and October, I don’t know.

“It is not a very satisfactory situation from a logistics point of view. We will live with whatever the problems are and deal with the problems as usual. We have no overdraft to worry about. Everything is paid for.”

Mr Atkinson said of Brexit: “It is a one-off situation which will hopefully never be repeated in my lifetime, and I am not thinking about dying shortly either.”