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Stobart Group underlines ambitions with merger plans

Stobart Air, which operates flights on behalf Aer Lingus and FlyBe, carried 1.7mln passengers, a 10% increase.
Southend Airport
Southend has seen a 25% rise in passengers

Airline and Southend airport owner Stobart Group Ltd (LON:STOB) Stobart Group Ltd (LON:STOB) might have ended talks over a merger with rival Flybe, but the ambitions seem intact.

The two companies share franchise arrangements between their respective airlines and in other areas.

READ: Stobart Group pulls out of Flybe Group bid talks

Stobart wanted to make that relationship even closer before deciding not to go ahead with a deal.

The leaked plan, though, did underline Stobart’s ambitions in air transport and elsewhere.

Southend, for example, saw a million passengers pass through its doors in 2017, a 25% year-on-year increase.

Up to £40mln will be invested in awareness, route development, branding, marketing and airline incentive deals at Southend before end-February 2021.

Meanwhile, Carlisle Lake District Airport is on course to open for passengers for the first time this summer.

Passenger numbers rising

Stobart Air, which operates flights on behalf Aer Lingus and FlyBe, carried 1.7mln passengers, a 10% increase.

The company’s biomass division, meanwhile, produced 1.3mln tonnes per year of renewable fuel in the first two months of 2018.

Stobart Energy has closely managed its costs and the underlying earnings (Ebitda) margin per tonne is ahead of target, with a defined plan for delivering targets for 2022 now in place.

Warwick Brady, chief executive, progress had been good over the past year and he was pleased to be welcoming passengers at Carlisle Lake District Airport from summer of this year.

“We continue to realise value from our infrastructure and investment divisions and these disposals are expected to support the dividend up until 2022, when we expect our operating divisions to meet their targets for Ebitda contribution," he added.

The group confirmed its quarterly dividend would be maintained at 4.5p a share.

At 233p, Stobart is valued at £817mln.

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