Stobart ramps up investment at Southend Airport
Energy division supplies 45% more biomass to UK power stations in 2018
Rail and civils division generating improved results under new strategy
Trading in line with expectations
What Stobart does:
Within the aviation arm, the company owns London’s Southend Airport.
Stobart has been ramping up investment at the airport after selling its regional airline and aircraft leasing businesses to Connect Airways – the joint venture it set up with Virgin Atlantic and Cyrus Capital.
The company sold the businesses in exchange for becoming a 30% shareholder in the venture. Cyrus is the lead partner in the venture with a 40% stake while Virgin owns a 30% interest.
Stobart’s energy services division delivers waste wood and other waste derived fuels to biomass plants in the UK.
The rail and civils unit provides specialist rail, civil and infrastructure engineering and management services to customers such as Network Rail.
- Stobart plans to invest in new infrastructure at Southend to enable the airport to handle several times the number of passengers it welcomed in 2018 when 1.5mln people walked through its departure lounge.
- To fund its investment, the company use some of the money from the sale of its airline and aircraft leasing business. It will also trim its annual dividend to 6p from the 15p it paid for the year to February.
- Stobart supplied 1.3mln tonnes of biomass to UK power stations last year – some 45% more than it supplied the previous year. All but three of the power stations have now been commissioned and are in full contractual operations.
- Following a review of the rail and civils division, Stobart has strengthened the management team and tasked it with winning more contracts with tier-one customers. This group said this strategy is “generating improved results” in terms of new business.
In a pre-close trading update in March, Stobart said: “The company continues to make strong commercial progress in its core aviation and energy operating divisions and is trading in line with management expectations.”