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Esken says Stobart Energy is 'delivering important cash generation'

It has been a tough time for the aviation side of the business but there is light at the end of the tunnel. Meanwhile, the energy business provides valuable cash flow

Esken Ltd -

Esken Ltd (LON:ESKN), the aviation and energy infrastructure group, saw its shares rise in early deals after reporting an encouragingly low level of cash burn.

Esken, previously known as Stobart Group, said it had £77.4mln of cash and undrawn bank facilities available at the end of February.

The group’s business has been hit hard by the fall-out from the coronavirus (COVID-19) pandemic but said that thanks to strict financial division, cash burn – excluding the Stobart Air and Propius parts of the business – was just £9.4mln in the six months to the end of February.

Esken said it remains committed to exiting Stobart Air and Propius and expects to do so in the near term.

The group said London Southend Airport benefited from continued activity through its global logistics operation while gate fees at Stobart Energy have continued to improve towards pre-COVID-19 levels.

“Stobart Energy is delivering important cash generation at a time of challenge within our aviation businesses,” said David Shearer, the executive chairman of Esken.

"We have continued to deliver against the strategy we set out at the time of our capital raise in June 2020 despite the business interruption caused by COVID-19 extending far beyond all reasonable expectations at that time,” Shearer said.

"Esken is becoming a more focused business. We divested the Rail & Civils division and remain committed to exiting Stobart Air and Propius. As a board, we are undertaking a review of our strategic options in light of the impact of the pandemic. We are doing this to ensure that we protect the capability of our core operations and focus on delivering value for shareholders,” Shearer declared.

Shares in Esken were up 2.7% at 34.9p in the first hour of trading.

Quick facts: Esken Ltd

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Price: 13.26 GBX

Market Cap: £138.43 m

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