- Stobart Group said its aviation division made good progress, with passenger numbers growing 22% year-on-year through London Southend Airport.

In energy, delays in commissioning certain third party biomass power stations impacted short term volumes but EBITDA per tonne is ahead of target.


- Rail: on track to deliver EBITDA on rail and civil engineering projects

- Infrastructure/Investments benefited from significant uplift in value of around £120m and cash generation of around £113m following the partial disposal of the investment in Eddie Stobart Logistics, in which we retain a 12.5% stake

- Stobart Group returned £26.4m to shareholders in dividends since 1 March 2017

- Quarterly dividend increased from 3p per share to 4.5p per share from July 2017


In the five months to 31 July 2017, passenger numbers at London Southend Airport increased by 22% to 482,000.

This increase reflects the growing awareness of our airport's customer proposition.

London Southend Airport offers a convenient and efficient experience at a time when demand for air travel in the London area is increasing and the other airports are at capacity, particularly at peak times.

We are pleased to announce that London Southend Airport was recently awarded the highest score (84%) of any London airport for customer satisfaction by Which?, a position it has held for the last five years.

We continue to have advanced talks with a view to introducing additional airlines to operate from London Southend Airport.

This is taking longer than originally planned, with airlines' planning schedules requiring a lead time of 6 to 18 months for investment in new operations.

EBITDA per passenger from commercial airport activities is close to the management's target with commercial enhancement activities ongoing.

We continue to support new route development at London Southend Airport, through our franchise with Flybe operated by our regional airline. In May 2017, we started operations to 11 additional European destinations.

The group is confident about meeting the 2018 and 2022 calendar year targets but with some risk in the near-term targets.


Stobart Group successfully deployed its logistics experience to put in place a renewable energy fuel supply chain to supply two million tonnes of biomass to power stations across the UK.

Six of these are new power stations either in commissioning or due to be commissioned soon.

However, as widely reported, the new power stations have experienced both delays in commissioning and volume volatility during the commissioning process, outside of our control.

In the first six months, the variance in actual volume compared to notified volumes from these new power stations was around 190,000 tonnes with only around 40,000 tonnes supplied.

In the second half, according to latest notifications from new power stations, we would expect to deliver around 330,000 tonnes under these contracts.

Whilst some of these delays are longer than we could have anticipated, the long-term total volume is not affected as our contracted volume starts post commissioning at the start of commercial operations.

There are further non-underlying costs relating to the challenges in the build-up to the official contract start date of around £1.6m.

We are looking to recover some of this extra operational cost from the plants where it relates directly to their delays.

Our actual EBITDA per tonne is ahead of our stated objectives and our strategic targets remain unaltered.


The Rail division continues to develop its pipeline of work on rail, internal and third party civil works, and using innovation in the development of plant and machinery that will bring efficiencies to the rail and civils sectors, and help enhance profitability.


In the first half, both divisions are on track to deliver planned EBITDA.

This includes a significant uplift in value of around £120m and cash generation of around £113m following the partial disposal of the investment in Eddie Stobart Logistics, in which we retain a 12.5% stake.

We continue to look at opportunities to realise value through asset management and disposals at the right time.

Our regional airline and leasing business are ahead in the first half but the airline is expected to incur costs in the second half as it helps to build and market new winter routes flying out of London Southend Airport.

We are also reviewing alternative structures for our airline and leasing business that can play an important part in the consolidation of the regional airline sector.

Stobart Capital is now established and is actively identifying and progressing investment opportunities which it is developing with the Stobart Group Board via its Value Creation Committee.


We have set out our targets of 2.5m passengers at London Southend Airport and 2m tonnes of biomass supply annually, by the end of calendar year 2018.

We believe that we can achieve these targets but this is dependent upon the successful commissioning of third party biomass power stations and the securing of another major airline starting operations at the airport in 2018.

The Board is confident that short-terms delays will not affect the long-term value creation potential of the business.

We have also established and communicated extended targets through to 2022 of 5m passengers through London Southend Airport and 3m tonnes of fuel supply and we are confident that we can continue to deliver value to shareholders through this period and beyond.


We reported in the AGM statement in June an expectation to pay an increased quarterly dividend of 4.5p per share, starting with the payment made on 7 July 2017.

The Board has subsequently declared an interim quarterly dividend of 4.5p per share which will be paid on 6 October 2017 to shareholders on the register as at 15 September 2017.

Subject to Board approval, further quarterly dividend payments of 4.5p per share will be made on 19 January 2018 and 13 April 2018.

The group has non-operating asset resources available to support the dividend until 2022 and thereafter, dividends are expected to be funded out of operating profits.

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