Relaunched Fone Logistics' bid for profit

Nov 13 2009 by Andrew Mernin, The Journal

THE region’s biggest mobile phone firm has been reformed as a new entity with founder Ian Gillespie back at the helm, in a move which it says will increase profits, despite leading to a plunge in turnover.

Cramlington-based Fone Logistics, which three years ago generated £100m-a-year in revenue, said its relaunch would ensure it made more profit on a reduced annual turnover of around £50m.

The transfer of the company’s assets to the new trading company called Fone Logistics Limited has been described as “corporate housekeeping”.

Three years ago company founder Ian Gillespie sold two-thirds of his share of the 13-year-old business but he is now back in charge and taking a more hands on role.

Finance director Michael Fitzpatrick said the firm had now shifted its focus from individual customers to the SME market which, although generating less transactions and therefore less revenue for the business, would deliver more profit.

He said: “We did a bit of housekeeping. We haven’t hurt anyone and we haven’t not paid anyone. We have started a new company and that company has acquired the trading assets of the existing company.”

Managing director Ian Gillespie, who built Fone Logistics into one of the fastest growing firms in the North East after setting it up in 1996, said: “It is not a secret that, for some years, the corporate structure of Fone Logistics has been out of kilter with where the business is at in its performance, and with our future aspirations for it.