Consolidation is the watchword for StobartStobart, but the company behind the Eddie Stobart trucks was still confident enough about its 'pay-as-you-go' haulage business model to increase debt to fund expansion plans.
Stobart completed the integration of the James Irlam chilled distribution business into Eddie Stobart during the first half, and this is expected to generate savings of £500,000 this year and £1.1m a year thereafter. The company has about 1,600 lorries in the UK and utilisation was slightly down at 83.5 per cent, mostly due to the integration of James Irlam. The chilled transport operation benefited from the consolidation of the Innovate chilled logistics business and sales here have grown by 22 per cent since January, with the load factor rising from 70 to 76 per cent.
Of Stobart's other business, the airports side has received considerable investment with £10.1m spent buying Carlisle airport. Management is now re-organising the business and plans are being drawn up for a purpose built distribution centre at the site. Chief financial officer Ben Whawell noted that the company is also investing heavily in Southend airport in a bid to match Southampton's twp million passengers a year.
Broker Daniel Stewart forecasts full-year adjusted pre-tax profits of £28.4m and EPS of 8.3p (£23.8m and 8.1p in 2008.)
STOBART (STOB) | ||||
|---|---|---|---|---|
| ORD PRICE: | 123p | MARKET VALUE: | £307m | |
| TOUCH: | 122-123p | 12-MONTH HIGH: | 128p | LOW: 71p |
| DIVIDEND YIELD: | 4.3% | PE RATIO: | 11 | |
| NET ASSET VALUE: | 115p | NET DEBT: | 53% | |
| Half-yearto 31 Aug | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2008 | 199 | 11.0 | 2.24 | 2.70 |
| 2009 | 218 | 11.1 | 3.75 | 2.00 |
| % change | +10 | +1 | +67 | -26 |
Ex-div: 28 Oct Payment: 10 Dec | ||||
