Stobart Group Limited Pre-Close Trading Statement (3281B)
September 20 2018 - 2:00AM
UK Regulatory
TIDMSTOB
RNS Number : 3281B
Stobart Group Limited
20 September 2018
The information contained within this announcement is deemed to
constitute inside information as stipulated under the Market Abuse
Regulations (EU) No. 596/2014. Upon the publication of this
announcement, this inside information is now considered to be in
the public domain.
20 September 2018
STOBART GROUP LIMITED
('Stobart Group' or 'the Group')
Pre-Close Trading Statement
Stobart Group Limited, the Aviation, Energy and Rail &
Civils business, has today issued the following pre-close trading
statement before the announcement of its interim results for the
six months to 31 August 2018. This announcement will be made on 24
October 2018.
Highlights
-- Aviation: Passenger numbers at London Southend Airport up by
37%; Ryanair flights starting in Spring 2019 and the easyJet
partnership will drive further growth, with an additional aircraft
added this summer
-- Energy: Growth of processed tonnages sold up circa 50%
-- GBP27.5 million net cash realised in sales from non-operating assets
-- Interim dividend of 4.5p per share declared. This will be
paid on 5 October 2018 to shareholders on the register as at 14
September 2018
Stobart Group has continued to commercialise its core operating
businesses, delivering operational progress in Aviation and
Energy.
At London Southend Airport, the Group has focused on improving
awareness through branding and marketing, route development, and
airline incentive deals to accelerate its growth. During the
financial year, we accelerated the previously announced GBP30m to
GBP40m investment plan, principally in relation to the franchised
airline business, to enhance the value of the airport through an
increase in sustainable and profitable passenger numbers. The
introduction of Ryanair flights in Spring 2019 is the next step in
the growth of our London airport. This significant long-term
partnership agreement is expected to result in at least one million
additional passengers in the first year and more than five million
in the first five years. A new agreement with The Restaurant Group
to introduce six new food and beverage brands to the airport will
help maximise the commercial value of these passengers.
The agreement with Ryanair gives us further confidence that we
will deliver on our aim to welcome five million passengers a year
to the airport by 2022. The investment in the franchised operations
from London Southend Airport has contributed successfully to the
attraction of other airlines to the airport. The results of the
Aviation division for the full year, excluding the investment in
the franchise operations, are expected to be broadly in line with
expectations.
Stobart Energy has significantly increased underlying EBITDA and
tonnes supplied compared to the prior year despite continued delays
in the commissioning of third-party energy plants. These delays
have put pressure on the supply chain for the second year running
and exaggerated the impact of non-underlying costs. Therefore, the
results for the Energy division will be slightly below expectations
in the short term. However, the investment in "best in class"
infrastructure, including cutting-edge IT systems, means that
Stobart Energy is well positioned to deliver strong profitability
per tonne when energy plants are operating to target.
Stobart Rail & Civils secured framework contracts with
Network Rail, Transport for Greater Manchester, and is an Alliance
member for the TransPennine route upgrade. The business also
renewed its partnership with the Environment Agency to deliver
Emergency Response. Other contract wins include the Newton Heath
and Inverness maintenance facilities contracts with Northern and
Scot Rail, providing previously untapped revenue streams. The
business has reviewed its revenue recognition on long-term
contracts and adopted a more prudent approach. This means the
results for the year are likely to be lower than expectations.
The Group has moved quickly to action the proposals set out by
the Board in July designed to unify the interests of shareholders.
It appointed a leading independent search firm Russell Reynolds as
part of a thorough and rigorous process to refresh and further
strengthen the Board. In August, the Board announced the
appointment of Nick Dilworth as Executive Director and Chief
Operating Officer, Ginny Pulbrook as Non-Executive Director and
Michael Williamson as Interim CFO.
Warwick Brady, CEO, Stobart Group commented:
"We are reviewing all aspects of the Group to ensure we are well
placed to deliver the ambitious growth targets set by the Board to
double the value of the business. We are confident that we can meet
our commitment to shareholders to unify the business and provide
the framework for the delivery of the Company's strategy to the
benefit of all stakeholders."
The person responsible for arranging the release of this
announcement on behalf of Stobart Group is Louise Brace, Company
Secretary.
Enquiries:
Stobart Group Limited c/o Redleaf Communications
Charlie Geller, Head of Group Communications
Redleaf Communications +44 203 757 6880
Robin Tozer stobart@redleafpr.com
Ian Silvera
Fiona Norman
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Authority to act as a Primary Information Provider in the United
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END
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