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With average load of under 10 there's no surprise there.
Read this too : https://www.echo-news.co.uk/news/18709445.plans-southend-airport-hotel-refused-council/?fbclid=IwAR0KRQkYUk94_GnCNOyXplydFZBWw8OQ_i8Hnbw20GwfqFVCXYawZ0UcHrg
Interesting comments from the council about previous behaviour of the airport. Seems this has gone some way to sway the decision.
That a £5 million vote of confidence at the SP on 04 Sept.
Bought in £13k worth, had this share when it was £2.50 ad sold, can’t believe it’s went down so much, looks like value
Richard Griffiths / Serendipity Capital Limited now holding 23,240,624 shares, ( 3.71% )
G
Someone is going to bid for stobart shortly .they will want the airport assets.
Hi Castle - another good spot by you early doors this morning with your link.
Hi Volcano - STOB had to respond to the press speculation, so it does look like progress is being made here.
If and when a deal is struck, how it's structured will be key. It'll surely be contingent on securing the extension to the Aer Lingus franchise contract. ( anyone interesting / invested should re read the 4th June RNS, to understand the relevance of this potential sale ).
Should it proceed it's another tick in the box. For me if STOB complete this transaction, so quickly on the back of the sale of the Rail & Civils, it confirms the BOD are progressing the strategy, outlined in that key RNS in swift order.
This transaction, hopefully could / should remove those ongoing lease guarantees, which would strengthen STOB's financial structure and cashflow moving forward.
gla
G
Who was brave enough to buy at 23.50 ,nice
Bet a few go to Faro though ;-)
GL SR
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Ryanair increases Portugal flights from London Southend
https://www.essexmagazine.co.uk/2020/08/ryanair-increases-portugal-flights-from-london-southend-airport-as-government-puts-it-on-safe-list/
A NEW route from Southend has launched as the airport aims to bounce back from Covid-19 and recover from easyJet’s exit.
The airport launched direct flights to Bergen, in Norway, with airline Widerøe yesterday, as the first flight departed at 10.45am.
The flights will come as a welcome boost, with the final easyJet flight leaving the airport yesterday. ..........
https://www.echo-news.co.uk/news/18687915.new-route-launched-easyjet-departs-airport/
Time for Stobart to fly?
“...So with a market cap of around £150m and cash of aprox £110m is #STOB worth a look at 25p?...”
https://total-market-solutions.com/2020/09/01/stobart-group/
Emm - off book trade went through at 16.38, at 24.66p for 309438 shares, value £76.3K
G
Yes indeed, I thought I'd come back to cheer everyone up a bit..as for AVCT I actually bought in there at sub 120 when the raise came along about a month ago..should have jumped out at 195p last week, just failed to get home in time to put sell order through...just winding a few of the guys up their to get a reaction...well that certainly worked the fireworks went off straight away...lol...the spike here on Stob last week or so was good for you but sudden retrace could have caught you out, this one could easily go either way on news....Covid still a great threat to airlines and travel...I see Rolls Royce in deep trouble and need billions to prop up their balance sheet according to yesterday's news...see you later....
Hi Truth - yep Gatwick in a pickle too, reporting a £321M loss for the first six months of 2020.
Stansted boss slams Govt. for "illogical and chaotic" approach to travel quarantine.
https://www.eadt.co.uk/news/stansted-airport-boss-slams-government-1-6810818
Looks like a number of airports are getting twitchy - as we look forward to the Autumn / Winter period.
Does anyone know if any of the other airports in the UK have a second source of revenue ?
STOB seems very fortunate to have its Energy Division, lets hope over the coming months, it gets back to its monthly pre covid tonnage output as soon as practical.
I listened to Sadiq Khan on LBC this morning and he laid out his case for an extension to the furlough scheme, post Oct end, on a focused basis, clearly his agenda is London. But I do wonder will we see another Govt. U Turn.
Then just to add another bit of doom and gloom, Norwegian Air says it could still go bust despite its bailout :
https://www.lse.co.uk/news/norwegian-air-warns-it-could-go-bust-despite-bailout-jgf5ajbgal6klu3.html
Oh to finish on a brighter note - Ryanair says it's increasing Portugal flights from Southend :
https://www.echo-news.co.uk/news/18680867.ryanair-increases-portugal-flights-southend-airport/
So it's not all bad lol.
gla
G
Moni - welcome back lol
You just couldn't keep away could you. I took a small wager with myself that you'd break your promise not to post here till it was at 20p, emm when was that - oh yes 31st July, where have you been - oh yes I see from your posting history you've been over on the AVCT bb "cheering them up". No agenda there then "wink wink".
Last time you posted here - STOB shot up to 30p within a few days, I did very well out of that little run up. Maybe you could make it a regular thing.
No in all honesty its great to have you back - in truth I only really got going posting here because of your "rounded and considered thoughts".
G
Just thought I'd have a look in to see how the dog was getting on...looking like 20p isn't far away....
Birddog - I'm with you on your later post, "stemming losses/ cash drain" which hopefully will be through close management of costs.
As STOB have highlighted, to this end
- no div costs
- reduced cap ex - £10m for Southend and only £2m for the Energy Division as a whole this year
- reduced finance costs, with bank debt cleared atm - though this will increase as monies are drawn down.
- Rail and Civils Divisions dumped
- Regrettably likely further redundancies in the Aviation Division can be expected
Let's hope the Energy Division is delivering in line with BOD's recent projections/ expectations.
G
Hi Birddog - You raise some valid points in your latest post, and perhaps we are on the same page to some extent, though again drawing different conclusions from the info provided.
To be honest I'd be pleasantly surprised if they generate half the 2.14M passengers, achieved last year, we've had all pretty much the whole of the first 6 months trading for STOB Feb - Aug end. The busy spring to summer period has passed. We now move towards to the Sept - Feb period, which is historically quieter, plus the EZJ decision and quarantine challenges.
I suggested previously that the Southend project has been put back 12 - 18 months. As to a break even passenger number position - Surely that is influenced by the amount of Capex spent in any particular year. I know I've raised this many times, but it continues to be ignored.
In previous years capex has been substantial - it had to be to get the airport from A - B. This year STOB are only spending £10m on additional improvements, and the BOD has outlined capex for the next two years, again at much reduced levels in that RNS I continue to flag, lol.
One thing I would say- Southend has demonstrated that passengers will happily use it if and when flights are provided, 2.14m confirmed this last year.
May I focus in on one comment you make in your second paragraph where you say :
" the debt it has to service needs a huge amount cash"
I'd remind you that following the placing a few weeks ago STOB cleared it's bank debt, and was sitting with cash on account.
It now has its increased £120M jt RCF, which it will utilise, over coming months. ( I did cover this with you in my post on 5th Aug ).
The BOD outlined it's RCF usage expectations ( based on a worst case of zero passengers at Southend until Feb 2021 end ). The figures are there for all to read. Their expectation as the likely RCF headroom by Feb 2021 end is also there.
May I politely ask, are you distrusting of the cash / debt figures provided by the BOD, and the projections - if that's the case, could you outline, where is it that you disagree with the info provided.
It's very likely that operations at Southend will need to be wound down through the autumn and winter months - all things being equal, and regrettably some further redundancies are likely when the Govt. furlough scheme ends.
It's no bed of roses,for Aviation, I agree, roll on a solution to passenger travel, I from one would like a break.
G
TF - I agree with you there. They have far too much skin in the game. It's about stemming the losses and cash drain. Some sort of moth balling until the market is strong enough to kick start it again.
Hi Gerry - I think we are actually both on the same page, but reading it differently. London Southend Airport Company Ltd is the operating company and owned by STOB. It loses a kings ransom every year. The argument for further investment is the potential / possibility / hope that it can reach the economies of scale to make it profitable. I would think that would mean 7m + passengers every year. In 2019 they achieved 2.1m. They would be lucky to achieve half that in 2021.
Then there is the value of the actual airport lease itself, as a going concern (operating as an airport, not the real estate). The only real value is potential profitability. It costs a fortune to run an airport and unless they can get the volumes in and moreover the right yield then they simply won't be able to not lose money. I cannot imagine for one minute that Ryan Air are paying a sustainable yield, and there is certainly no sign of any growth for some years to come. An asset that is actually a liability. If they down graded the airport, and focused on cargo and smaller operations then they might be able to make a modest operating profit given time. I'm guessing this isn't an option because the debt it has to service needs a huge amount cash and the only way to generate that cash is through profit or borrowing more. Neither of those seem possible.
Sorry to be a doom monger, but they're to big to be nimble and do not have the reserves to carry them through.
WOW.....yes, immensely shrewd.......
watched this constantly collapse. Love to buy in but really dont see any future in this, for the foreseeable.
Thx for that Truth, agree the major Institutional shareholders are down here atm.
Yep David Shearer is a shrewd guy, though his average here is high bearing in mind his previous buy in prices, though he did average down recently. Not sure he strikes me as the type of guy that knowingly chucks good money after bad, ( particularly when it's his own funds ).
I'm not one for sp predictions, will continue to look for trades on dips, buying on blue days, want to add to my "free carry" shares, as and when i can. To be honest STOB is not one of my major holdings, but hey - what fun is there chatting on other bb's like ULVR and the like.
G
Hi Castle - i'd not read that article - thx for sharing.
I'm taking it we all want to find a way to beat Covid 19, to allow Aviation and many other sectors to recover.
I've cancelled two holidays this year and re booked them for next year.
No one likes to see people losing jobs, I still feel STOB has two undervalued Assets, though I'd except, owning an airport does depend on it functioning and getting flights in and out and servicing passengers.
At present, it's fair to say, the future is uncertain. STOB will no doubt put in place the measures to conserve cash, that it's previously outlined. It also has it's increased RCF's ( RCF A - £80M & RCF B - £40M ).
We'll know more on the Energy Division performance in Nov.
In the meantime, I'd anticipate, ongoing speculation here, that's understandable.
gla
G
Gatwick Airport to cut up to 600 jobs amid travel slump
https://www.lse.co.uk/news/update-1-uks-gatwick-airport-to-cut-up-to-600-jobs-amid-travel-slump-a79thy18rvxdxcs.html
"Gatwick said that currently 75% of its staff were on the
government's job retention scheme which is due to end in
October".
It'll be interesting to see how all Airports deal with the ending of the Job retention scheme, very challenging times.
Not great for the workforce, servicing all airports atm.
G
Hi Birddog - in response to your post ( 12.23 ).
You post re Southend Airport loses - :
"With the best ever numbers for passenger numbers, aircraft movements and revenue in the 19/20 FY yet they still lost tens of millions".
You follow that with :
"Maybe there's something I can't see?"
The audited accounts provide info on the Aviation Division as a whole, last Financial Year
Aviation Revenues - £56.8M
Aviation Profit - £8.6M
Added to this were the profits from the Energy Division and losses from the Rail and Civils - now dumped.
These figures were of course before the write downs and impairments ( Non-underlying items - (138.6) ) ouch ! But it's important to drill down on those write downs, to consider whether that's it - or can you see more to come ?
As Truth mentions can STOB avoid further banana skins ? It has it's cash, it has rightly written down assets, in the last Financials.
I'd offer two thoughts on Southend - it's worth considering the capital expenditure, that was required over recent years to take it from A - B, then review the BOD's capex plans for the airport going forward. Secondly it may be worth looking at breaking down the Aviation Divsion performance, as a whole, and then attempt to isolate Southend's delivery - if possible to get a clearer view and value of the Airport.
That said, the future of Aviation, world wide does depend on finding solutions to the virus, the future is uncertain, and at the very least it's likely that the Southend project has been put back by 12 - 18 months.
It's very "foggy" out there lol.
gla
G