Removals business is going like clockwork for Morison despite the housing downturn

Published on Sunday 20 July 2008 21:01

A SCOTTISH removals entrepreneur is defying the housing slowdown by snapping up a string of distressed rivals.

Clockwork Removals, which is headquartered in Edinburgh, has completed two deals in the past two months and director Courtenay Morison has revealed it has several others in the pipeline.

Morison, who founded the company 12 years ago, admitted a near-collapse in mortgage approvals had hit the removals business hard.

But he told The Scotsman: "We're in a period of stress or even distress in the removals market. There's been a major slowdown in sales and that has had a knock-on effect because people simply aren't moving. The removals sector is one of the first to get hit." Morison said Clockwork can continue to trade profitably, then prosper when the housing market improves.

"In a lot of the businesses we're buying, the owners are one or two steps removed – absentee owners who got into the business without knowing a lot about removals, thinking they can make a profit without running the business," he said. "You need to be hands on, available, 24 hours a day."

In the past three months, the company has bought Perth Removals from the Oban-based John MacLachlan Group, and Sheffield-based Lawlers. The two acquisitions are expected to add annual sales of about 1 million, even in a declining market.

Morison said the company was also considering at least three other targets, either extending the business in new regions or bolt-on acquisitions in cities in which it already operates.

As well as the businesses, which are being sold for as little as nominal sums, Clockwork is also buying the property from which the acquisitions are operating.

While lending conditions had tightened, banks are still prepared to lend the company around three-quarters of the value of land, Morison said.

Clockwork is expected to record turnover of around 16m this year, above the 15m generated last year, but well below the 20m the company originally forecast for 2008. "Business has slowed down a lot so if we can get a margin of 4 per cent, we'll have done well."

Morison set up Clockwork in 1996, originally combining car fleet operations with a removals business. It now operates in more than a dozen locations, including six in England.

Last year it bought London-based storage group Edwards for 1.6m. In January, the London business became only the second removals and storage company to be granted a prestigious royal warrant by the Queen after supplying the royal household.