Despite positive headline numbers in its energy and aviation divisions, full-year results for Stobart Group (STOB) showed the limits of the biomass-to-airports logistics firm’s legacy reliance on asset disposals. A raft of items – including £5.2m in legal fees to tackle a shareholder dispute, rising costs, £16.3m of non-cash impairments, and a £12.3m onerous lease provision – contributed to a post-tax loss of £58m for the year.
Negative operating cash flow contributed to net debt more than doubling, while current assets were cut by more than half to £79.7m, and well below current liabilities. And while a “rebased” dividend is expected to remove £44m of cash requirements from the business in the coming year, income seekers’ attention is drawn to plans for a further capital review, “which could result in the dividends expected in November 2019 and July 2020 being reduced” to fund investment elsewhere.
On that front, February’s successful bid for a stake for the remnants of Flybe (to be re-branded Connect Airways) shows the direction of travel, and presumably underpins a hope to one day see 10m passengers use London Southend Airport each year, assuming planning permission might be granted.
Analysts at Stifel expect an adjusted loss of 0.5p per share for the 12 months to February 2020, against negative 4.7p in FY2018.
| STOBART GROUP (STOB) | ||||
| ORD PRICE: | 128p | MARKET VALUE: | £476m | |
| TOUCH: | 128-129p | 12-MONTH HIGH: | 273p | LOW: 102p |
| DIVIDEND YIELD: | 7% | PE RATIO: | na | |
| NET ASSET VALUE: | 80p* | NET DEBT: | 28% | |
| Year to 28 Feb | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2015 | 117 | -9.4 | -2.4 | 6.0 |
| 2016 | 127 | 10.0 | 2.7 | 6.0 |
| 2017 | 129 | -8.0 | -2.7 | 13.5 |
| 2018 (restated) | 105 | 109.3 | 31.4 | 18.0 |
| 2019 | 147 | -42.1 | -12.2 | 9.0 |
| % change | +39 | - | - | -50 |
| Ex-div: | 20 Jun | |||
| Payment: | 31 Jul | |||
| *Includes intangible assets of £100m, or 27p a share | ||||
