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Blueheath interims reveal cash losses.

Blueheath continued to haemorrhage cash in the six months to 2 September, according to the wholesaler's interim results.

Sales rose strongly by 48% to 77.2m[pounds sterling], but operating losses climbed from 2.3m[pounds sterling] to 3.6m[pounds sterling].

Chairman Richard Rose admitted the results were "unsatisfactory". Closing the company's Tamworth depot and transferring volume to its operations in Wrexham, Wales, and Thurrock, Essex, earlier this year had not delivered projected cost savings, he said.

However, he revealed that following a strategic review, Blueheath was planning to cut costs in several areas, with unprofitable accounts, an expensive delivery system and an over-complicated buying model set to be targeted.

Blueheath said the closer links it had forged with Key Lekkerland would help it tackle its problems. It transferred its Wrexham depot to the buying group last month, with its Thurrock shed already affiliated to the organisation.

Its relationship with Key Lekkerland had helped to simplify its buying operation and its brand offering would be enhanced by introducing the Keystore symbol group fascia, said Rose. The alliance would help Blueheath win national contracts and deliver to customers outside its territory.
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Article Type:Brief article
Date:Dec 2, 2006
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