26 Aug 2011 07:00
Stobart Group Limited
('Stobart' or 'the Group')
Pre-Close Trading Statement
26 August 2011
Stobart Group ('Stobart' or 'the Group'), a leading provider of multimodal transport logistics, property development and biomass supply, is issuing its pre-close trading statement prior to the announcement of interim results, expected on 26 October 2011.
The Group has progressed well in the first six months of the year and expects to deliver pre-tax profits ahead of the same period last year. The Group has reorganised into five key operating divisions and set out on a three year plan to deliver significant value to shareholders. The divisions have experienced different challenges during the six month period against the background of difficult markets, but have delivered a number of successes, as outlined below.
Transport & Distribution - Over the past 12 months the transport market has witnessed significant change, predominantly led by consumer buying patterns. The result is shorter lead time, significant fluctuations in volume caused by promotions and increasingly inaccurate customer forecasting. These changes culminated in a difficult period from the end of May through to the middle of July, by which point the business had implemented measures and systems to ensure it could successfully meet these challenges. During this difficult period the performance of the business was impacted. However, August trading has improved materially and we expect a stronger second half to the financial year.
Estates - This division has finalised the planning and initiated the marketing for Stobart's multimodal site in Widnes. Other commercial and industrial property opportunities are being considered and further value has been generated in existing investment properties.
Infrastructure and Civil Engineering - External work remains slow but internal developments are progressing well, in particular the London Southend Airport project remains on target to meet the development milestones required for launch of the new runway in 2012. The challenges to the extension of the runway have been unsuccessful. This allows full development of the Airport with no further legislative obstacles.
Air - At London Southend Airport, following the announcement of a 10 year contract in June, easyJet have announced a number of further routes and there is significant interest in the airport from other operators. The airport railway station, operated by Stobart Rail, opened in July creating another revenue stream for the Group. Carlisle Lake District Airport's revised planning application is being considered by Carlisle Council. The Group remains hopeful that the airport will receive the backing for its investment plans.
Biomass - The biomass fuel supply division has traded over 200,000 tonnes of product during the last six months with significant export volume into Scandinavia. Volumes are expected to double in the second half, delivering strong profit growth during the period.
Enquiries:
Investors / Media:
Sara Batchelor 07904 680547
James Andrew 07772 534985
Stobart Group: 01925 605400
Ben Whawell, Chief Financial Officer
Andrew Tinkler, Chief Executive Officer