Trading Statement

RNS Number : 2544J

Stobart Group Limited

08 September 2016

 

8 September 2016

STOBART GROUP LIMITED

('Stobart Group' or 'the Group')

Pre-Close Trading Statement

Stobart Group, the infrastructure and support services group, issues the following pre-close trading statement prior to the announcement of the interim results for the six months to 31 August 2016, which is expected to be made on 27 October 2016.

All growth operating divisions are performing in line with expectations whilst our infrastructure division has exceeded expectations. 

Energy

Our target is to supply over 2 million tonnes of biomass fuel per annum and grow EBITDA to £10 per tonne by 2018. Long-term customer contracts have been secured to achieve this target, with six biomass plants currently under construction and due to come on-stream before May 2018. Our current customers require 1.0 million tonnes per annum, with two further biomass plants becoming fully operational in the six months to 31 August 2016. We will begin to supply two further biomass plants in the second half of the year.

In the six months to 31 August 2016, both EBITDA per tonne and volumes supplied were at a similar level to the same period last year. Further processing and storage sites required to service the future increased volumes have been identified.

As previously announced, Ben Whawell has assumed the role of Chief Executive Officer of the Group's Energy division. Alongside Ben, the senior management team has been bolstered to support the division's expected strong growth.

Aviation

Our target is to grow passenger numbers at London Southend Airport to over 2.5 million passengers per annum and deliver £8 EBITDA per passenger by 2018. As reported in the AGM Statement in June, London Southend Airport's management team is in advanced talks with a number of low-cost carriers and full service operators, who want to take advantage of the airport's access to London capacity at peak times. These talks are progressing well.

In the six months to 31 August 2016, like-for-like passenger numbers were broadly in line with the prior year, with on-time performance and load factors continuing to outperform airline targets.

Infrastructure 

Our Infrastructure division is trading ahead of expectations. The disposal of our investment property in Speke achieved net proceeds of £37.0 million and a profit of £11.6 million. We anticipate further disposals in line with our plan in the second half.

Dividend

We reported in the AGM statement in June an expectation to pay a quarterly dividend commencing in October 2016. The Board has declared an interim dividend of 3.0p which will be paid on 7 October 2016 to shareholders on the register as at 16 September 2016. Subject to Board approval, further quarterly dividend payments of 3.0p will be made on 20 January 2017 and 7 April 2017.

Board

As previously stated, the recruitment of a new Chief Financial Officer for the Group is well advanced and a further announcement will be made in the near future.

Chief Executive Andrew Tinkler commented:

"Significant progress has been made in the period, illustrating that we are on track to achieve our objectives.

"A particular highlight is the momentum in the Energy division, which we are confident will continue during such an important point in its development and we look forward to delivering the expected growth. Within Aviation, we are pleased with how the discussions with carriers and operators are progressing and look forward to a positive outcome in the coming period.

"We are very pleased to be declaring our first quarterly dividend, reflecting the cash generation of the Group and its commitment to drive value for shareholders."

Enquiries: 

Stobart Group	[phone]
Andrew Tinkler, Chief Executive Officer
Redleaf Communications	[phone]
Emma Kane
Rebecca Sanders-Hewett
influence Associates	[phone]
Stuart Dyble James Andrew

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