TIDMSTOB
RNS Number : 8406E
Stobart Group Limited
16 May 2013
16 May 2013
Stobart Group Limited
("Stobart" or "the Group")
Results for the year ended 28 February 2013
Stobart Group (Stobart), a leading provider of multi-modal
Transport and Distribution, Estates, Air and Biomass services, and
Infrastructure and Civil Engineering, today announces its results
for the year ended 28 February 2013.
Group Overview
-- After a pivotal year, the Group is on track with its four
year strategy (2011-15) to create shareholder value
-- Investment programme nearly complete
-- Group is moving into optimisation phase - focus is turning to
selective realisations and cash generation
-- Objectives include improved communication with shareholders and other key stakeholders
Financial Highlights
-- Group revenue from continuing operations was GBP572.4m (2012: GBP491.7m)
-- Underlying operating profit* was GBP44.9m (2012: GBP40.1m)
-- Underlying profit before tax** was GBP32.5m (2012: GBP35.4m)
-- Final dividend of 4.0p (2012: 4.0p) per share payable on 5
July 2013, making a total for the year of 6.0p (2012: 6.0p)
-- Profit before tax and discontinued operations increased to GBP36.0m (2012: GBP29.2m)
-- Earnings per share from continuing operations of 9.0p (2012: 8.5p)
-- Loss on discontinued operation of GBP13.4m (2012: GBP0.3m)
-- Net cash generated from continuing operations GBP41.4m (2012: GBP59.0m)
-- Group property assets at GBP347.2m (2012: GBP327.0m)
-- Net Debt is GBP216.4m (2012: GBP166.0m)
Divisional underlying profit summary
2013 2012
GBPm GBPm GBPm GBPm
------------------------------------- ------- ------- ------ ------
Underlying operating profit* 44.9 40.1
Finance costs, finance income
and share based payments (12.4) (4.7)
Operation based divisions
Transport & Distribution 29.7 27.7
Biomass 4.0 1.2
Infrastructure & Civil Engineering 3.2 4.4
Asset based divisions
Air (0.7) (0.4)
Estates 6.5 12.4
Central costs and eliminations (10.2) (9.9)
Underlying profit before
tax** 32.5 35.4
Separately disclosed items 3.5 (6.2)
------------------------------------- ------- ------- ------ ------
Profit before tax and discontinued
operations 36.0 29.2
------------------------------------- ------- ------- ------ ------
* Underlying operating profit is a non GAAP measure shown on the
Income Statement which includes one-off and non-cash items.
** Underlying profit before tax comprises the underlying
operating profit of GBP44.9m (2012: GBP40.1m) less share based
payments of GBP1.2m (2012: GBP0.4m) less finance costs of GBP12.0m
(2012: GBP6.3m) plus finance income of GBP0.8m (2012: GBP2.0m).
Operational Highlights by Division
Transport and Distribution
-- Improved profits increased to GBP29.7m in tough market
-- Tesco work secured by 3 year contract from 1 March 2013
equivalent to over GBP500m of revenue over duration
-- Acquisition of Autologic Holdings in August 2012 for GBP12.4m
and disposal of non-core Vehicle Services operation for GBP11.0m -
enhances Pan-European offering and will create further synergy
benefits during new financial year
-- Loss making Chilled Pallet Network closed, but other profitable Chilled operations retained
Estates
-- Good return on investment from Estates division of 26%
-- Successful integration of Moneypenny portfolio
Air
-- Airport passenger run rate currently over 800,000 per annum
-- Secured 4(th) Southend-based aircraft for 2013 with likely
increase of around 250,000 passengers per year
-- Designated London's 6(th) airport by IATA
-- Investment in Airport near completion with final
infrastructure spend during 2013 to accommodate around 5 million
passengers
Biomass
-- New long-term Biomass supply contracts commenced with future revenue of over GBP140m
Infrastructure and Civil Engineering
-- Core profits of over GBP3m
-- Continued value-added services on internal projects
Chairman
-- As indicated on 2 April this year Avril Palmer-Baunack
yesterday (15 May) resigned as Non-Executive Chairman. Paul
Orchard-Lisle, a Non-Executive Director at Stobart Group since May
2011, has assumed the role on an interim basis while the search for
a new Non-Executive Chairman is completed
Andrew Tinkler, Chief Executive Officer, said:
"Despite a turbulent year and a tough economic environment, our
continuing operating businesses have produced a profit from
continuing operations ten per cent up on last year and have again
given us a good return on investment.
We are now at a pivotal point in our four year plan and with our
investment programme nearly complete we are moving into our value
optimisation phase. Through our property assets we will be looking
to return cash into the business, while our Air and Biomass
businesses are poised to deliver further value enhancement.
Our management team is now focused on realising value from the
investments made over the last few years."
Enquiries:
Stobart Group +44 1925 605 400
Andrew Tinkler, Chief Executive Officer
Ben Whawell, Chief Financial Officer
Influence Associates +44 20 7287 9610
Stuart Dyble/James Andrew
Lansons Communications +44 7979 692287
Tony Langham +44 20 7294 3617
tonyl@lansons.com
Chairman's Statement
The Group's trading performance over the last year enables me to
present a positive report. We remain focussed on delivering
substantial shareholder value in accordance with the development
plans agreed in 2011, and the ongoing proper governance of the
business.
Trading Results
Group turnover rose from GBP491.7m to GBP572.4m and the
underlying profit before tax was GBP32.5m compared with GBP35.4m in
the previous year. Group profit before tax before discontinued
operations for the year was GBP36.0m compared with GBP29.2m in the
previous year. The discontinuation of the chilled transport network
led to a loss after tax of GBP13.4m (2012: GBP0.3m) in the year. A
more detailed analysis of the Group and Divisional trading results
follows in the Chief Executive's Report and the Operational &
Financial Review.
The Board
There have been a number of Board changes over the past year
including Jesper Kjaedegaard stepping down at last year's AGM,
William Stobart's reappointment to the Board in September 2012 and
in January 2013, David Beever resigned from the Board to devote
time to his other interests. Following the acquisition of the
Autologic business in August 2012, Avril Palmer-Baunack was
appointed an Executive Director and Deputy Chief Executive. On 21
January 2013 she was appointed Executive Chairman, replacing Rodney
Baker-Bates. Mr Baker-Bates remains a Non-Executive Director of the
Group. Ms Palmer-Baunack resigned as Executive Chairman on 2 April
2013 and left the Group on 15 May 2013. Alan Kelsey resigned as a
Non-Executive Director on 23 April 2013. I was appointed Interim
Non-Executive Chairman on 15 May 2013 following Ms Palmer-Baunack's
departure from the Group on that date. In April, the Board
initiated a search, supported by consultants, for a new
Non-Executive Chairman. We have been pleased by the interest shown
in the appointment and expect to make an announcement in the near
future. We also anticipate the appointment of one or more new
Non-Executive Directors to support in the next stage of our
strategy.
The Board recognises fully that it has been tasked with
delivering enhanced shareholder value in accordance with the
strategy that we outlined at the time of the capital raising in May
2011. Our operating divisions are all performing well and are on
track to deliver returns in line with the overall strategic plan.
Our Board continuously reviews divisional performance alongside
market conditions to make sure that we make the right strategic
decisions for each of our businesses.
Dividend
An interim dividend of 2.0p was paid on 7 December 2012. The
Board is proposing a final dividend of 4.0p per ordinary share,
giving a total dividend for the year of 6.0p.
Outlook
The Group continues to respond robustly to the ongoing and
challenging economic conditions. Whilst issues in the Chilled
Transport network and the absence of disposals in Estates
marginally held back the performance at the half year, at the end
of the year Transport & Distribution and Biomass were ahead of
last year. This was matched with the maturing of investments at
London Southend Airport and the continued internal value delivered
by our Infrastructure & Civil Engineering division.
Our underlying core Transport & Distribution business is
strong and Biomass is growing year on year within a relatively new
sector whose speed of growth has been arguably hindered by the slow
pace of Government Renewable Obligation legislation. Stobart Air
has made great headway in establishing its initial key user base,
predominantly through our excellent partnership with easyJet. Our
strong and diverse property portfolio already delivers an
attractive income return. We will however take market led
opportunities to realise its capital value.
With the investment phase of our four year strategy
substantially complete our focus now moves to optimising
performance and delivering maximum value for shareholders from the
excellent base that we have built.
Paul Orchard-Lisle
Chief Executive's Report
We are at a pivotal moment in the delivery of our four year
strategic plan that we set out in March 2011. With the investment
phase now largely complete we are moving into the optimisation
phase, realising the value in our divisions and delivering strong
returns for our shareholders.
Our stated strategy of investment in businesses with high future
growth potential followed by a two to three year period of value
maximisation is on track. We understand fully that there are a
number of ways that we can deliver return on our investment.
Further, we know that a critical factor in maximising returns will
be to get the timing of our actions right. Earlier this year, the
Executive team, together with certain Board members, reviewed our
strategy and confirmed that it is the right one for the Group.
Matched with our commitment to sound governance, we will not be
diverted from our long-term plan to maximise returns by short-term
distractions. As we discussed last year, key in our ability to
achieve this for shareholders will be our ability to continue to
have the right people, in the right place with the right skills -
and at the right time. We are making sure we have that team in
place and we will continue to invest in our people through the year
to keep them focussed and on track.
It has been a busy year. The discontinuance of the Chilled
pallet consolidation business was complex in some ways for us, but
overall our Transport & Distribution business has had a hugely
positive year, further enhanced by the acquisition of Autologic in
August.
This performance was matched with exciting and rewarding
developments at London Southend Airport where we welcomed over
700,000 travellers through the airport during the period. This has
been predominantly as a result of our burgeoning and highly
successful partnership with easyJet. While costs have been slightly
higher than expected as we took on more staff costs at start-up, we
are very pleased with the development of the airport and our
position in the London marketplace, with passengers recently voting
us best performing airport for customer satisfaction.
As a result of our specialised offering of renewable fuel supply
and transportation, our Biomass business is now in pole position to
secure a significant proportion of this quickly developing market
as the legislative approvals come through.
The Estates division has had an active year and has delivered
strong results with the Moneypenny investment property portfolio
now fully integrated into the Group and with a plan for each
property. Going forward we will be looking to realise value in the
most mature assets which will contribute both cash and reduce Group
debt sooner than expected.
Overall the Group is well underway with the implementation of
our four year plan. All the building blocks are in place and the
investment phase is largely complete. We now move into the
optimisation and delivery phase to unlock the inherent value in our
business portfolio for the benefit of our shareholders.
Stobart Transport & Distribution
Transport & Distribution remains our largest operating
division. Our ability to continue to develop and implement leading
systems and processes has enabled us to remain competitive in a
challenging environment and we continue to work to increase our
already sector-leading fleet utilisation rates. We constantly
strive to improve performance, increase our levels of customer
service excellence and stay alert to opportunities to help our
customers improve efficiency levels through implementing multimodal
solutions.
In last year's Annual Report & Accounts we explained the
benefits of our Time Based Planning system. As we use the system
more we are better able to exploit its capabilities and thereby
improve its effectiveness in our business and the efficiency of our
operations.
Our ability to track each delivery and the elapsed time for each
stage of that delivery enables us to monitor the factors driving
our costs in detail, highlighting areas where we can, and do,
improve efficiencies. We collaborate with our customers as partners
in a business operation to improve performance and drive
efficiencies for the benefit of both their business and ours.
It is through our deployment of powerful analytical tools across
the business that we were able to spot firstly the opportunity to
reorganise the Ambient transport network and, secondly, establish
the need to restructure the Chilled business, which has led to the
discontinuance of the Chilled pallet consolidation business.
A year ago, we outlined our plans to restructure the Chilled
business that was originally acquired through the acquisition of
Innovate in 2008 at low cost out of Administration. We envisaged
the closure of two depots and a total restructuring charge in the
28 February 2013 Accounts of some GBP8.0m. As we began to implement
the proposed restructuring following our detailed and ongoing
analysis, it became apparent that this small load, multiple pick
and drop business, which was principally undertaken for producers
rather than retailers, was too unpredictable for a large scale
operation.
We carefully considered whether there was a way in which we
could re-engineer the business processes to reduce the imbalance in
part-loaded running and the incidence of small drops. Unfortunately
our analysis showed that we simply could not make this business
profitable at the rates that our customers were prepared to pay. As
a consequence, we decided to close the Chilled pallet consolidation
business. The loss in the year including closure costs was
GBP13.4m. This closure has not affected the chilled movements we
undertake for our supermarket customers which continue to operate
as part of the main Transport & Distribution business, or
within the warehousing operation that we acquired from Innovate,
which continues to perform well.
Stobart Rail Freight and Ports continue to operate well with
steady growth in both areas. This is demonstrated by the increasing
use of rail for our FMCG grocery traffic, creating both cost
savings for customers whilst helping them to achieve carbon
reduction targets. Our expertise in road-to-rail modal shift
enables us to intelligently assist customers, providing innovative
solutions for their logistical requirements. A typical example is
the supply of stock to central London convenience stores through a
rail facility at Euston Station.
In August 2012 we acquired Autologic Holdings plc for a cash
consideration of GBP12.4m. Autologic operated two distinct
businesses, Vehicle Distribution (transport) and Vehicle Services
(workshops and storage) in the UK, Benelux and Czech Republic. In
January 2013 we disposed of the non-core Vehicle Services business
for GBP11.0m. However, we retain the freehold site at Portbury,
which is used in this division, and currently lease it to the
purchasers. The Vehicle Distribution business has been re-branded
Stobart Automotive, forming a new business unit within our
Transport & Distribution division. During the new financial
year we expect to deliver savings and synergies from aligning this
business unit with others in the division.
We plan to bring the Autologic transporter fleet up to the
standards of the rest of our fleet. The reaction of customers to
this acquisition has been extremely positive and we are now
rolling-out the re-branding of the transporter fleet alongside the
introduction of new systems and technologies.
As ever, the sustainability of any one of our transport or
distribution operations is critical to both our customers and
ourselves. To that end, we work tirelessly to reduce the
environmental impact of our activities, not only by adopting the
latest low emission trucks, but also by optimising their driven
miles.
Stobart Estates
The Estates division has had a busy year and has delivered
strong results against the backdrop of a very challenging property
market. The Moneypenny investment property portfolio acquired in
2012 has now been fully integrated into the Group and a strategy is
being implemented to maximise the exit value of each property. A
number of asset management initiatives, including lease and rent
review negotiations, have been undertaken in the year. These have
been the key factors in the uplift in the value of the portfolio in
the year of GBP5.2m.
The development of 37 Soho Square into high-end residential
units is due for completion in June 2013. The first two sales at
this property are contracted off-plan for a total of GBP5.7m which
is extremely encouraging. Although the challenging market has meant
that disposals have been slightly slower than anticipated, the
division has nevertheless achieved three sales to date at a higher
than expected profit. It is also worth noting that the division
achieves a high income return, pending sales.
Key milestones have also been achieved elsewhere, including the
completion of the Holiday Inn development at London Southend
Airport and the gaining of planning consent for the redevelopment
of Carlisle Airport and a biomass plant at Widnes.
With the management structure and strategy currently in place,
the Board is confident that the Estates division will continue to
deliver strong results in the medium term.
Infrastructure & Civil Engineering
The Infrastructure & Civil Engineering division has played a
significant role in the development of London Southend Airport. It
will continue to do so with the extension to the passenger terminal
and other projects where we can use this division to drive value.
This will also be the case with the development programme at
Carlisle Airport which is expected to commence in 2013. Planning
consent has been obtained for the biomass plant at Widnes and this
too will be a project undertaken by the division. We are
considering a number of different funding options for these
developments.
External work, principally in the rail sector, continues and
looking forward, a number of significant infrastructure projects
have been announced by Network Rail and by Government. With our
well known and well proven ability to find creative and highly cost
effective civil engineering solutions, we are ideally placed to
competitively tender and secure new contracts.
Stobart Air
It has been a landmark year for London Southend Airport (LSA),
which is now officially recognised as London's sixth airport. We
extended our partnership with easyJet and by the end of the year we
expect to serve 15 easyJet destinations. It is our aim to increase
further the number of destinations available in response to the
recognition by both passengers and carriers of LSA's convenient
location and the benefits offered by its rail link to central
London.
Our relationship with Aer Arran, trading as Aer Lingus Regional
under a ten year franchise agreement, provides us with an
unrivalled opportunity to capitalise swiftly and highly
cost-effectively on the London to North America routes via Dublin.
We increased our holding in Aer Arann to 45% to drive volume into
LSA. This should deliver significant revenue and profit through the
airport helping to improve its value. Our next phase is to use the
airline to start new routes out of LSA with focus on Spring
2014.
The current passenger terminal extension, which is the last
phase of our significant investment in this operating asset. With
the investment phase now completed we move to the optimisation
phase to realise the inherent value in the airport. This will
enable us to continue to offer an excellent passenger experience
and build route numbers and volumes up towards our maximum capacity
of around five million per annum.
I am pleased to report that easyJet has settled in well and that
they have now taken the decision to bring the planned siting of
their fourth aircraft at Southend forward to June this year, 12
months ahead of schedule.
After a fairly lengthy process, we have finally secured planning
consent for the development of Carlisle Airport. The consented
development includes warehousing and distribution infrastructure,
runway refurbishment and associated developments. We are currently
understanding route and carrier planning for Carlisle Airport and
are aiming to capitalise on the business potential for London-bound
traffic, as well as providing an exclusive new in-bound route for
some of the Lake District's 40 million visitors each year.
Stobart Biomass
Demand for Biomass products is set to increase over the next two
years as Biomass-fuelled power plants, which are currently in the
confirmed planning or building phase, become operational. Robust
industry intelligence informs us that the Biomass product market
for existing and planned power plants totals 3.1m tonnes per annum.
This volume is split between those plants currently operational at
0.2m tonnes, in-build at 0.4m tonnes and 2.5m tonnes for plants in
pre-build phase. These predicted volumes evidence the opportunity
for growth.
This year we have already commenced supply on a number of
significant contracts, with several additional contacts already
confirmed for the coming year. Our comprehensive business offering
of fuel source and supply, matched with premier logistics
capability, means that we are well placed to increase our rate of
growth through 2013.
The strategic fit with the Group is strong with transport being
such a vital ingredient in the Biomass business. This has the added
benefit of expected margins in excess of our standard transport
business.
The Brand
The Stobart brand is an important asset to the Group and it is
important to reinforce the levels of quality and service that our
brand stands for and underlines. Its status reassures our customers
and partners that they are working with a business that takes time
to understand their needs, a business that develops innovative and
cost-effective solutions and delivers the highest quality. Our
positive brand image also plays an extremely important role in
building employee loyalty. Our team are happy and proud to work as
part of Stobart Group; we recognise their support and reward it by
helping every one of them to reach their full potential within the
business.
More recently we have leveraged the brand to make big savings on
insurance and legal costs by taking these functions in-house and we
are now offering these services externally under the Stobart
name.
We are on track. We know how important it is to deliver strong
return and this is now our focus. We will continue to communicate
with you through the year and look forward to sharing further good
news.
Andrew Tinkler
Operational and Financial Review
Results
Group revenue from continuing operations increased to GBP572.4m
from GBP491.7m in the previous year. Underlying profit before tax
was GBP32.5m compared with GBP35.4m in 2012 and recorded profit
before tax and discontinued operations rose to GBP36.0m from
GBP29.2m in 2012. A breakdown of the divisional profit before tax
is set out below.
Divisional underlying profit summary
2013 2012
GBPm GBPm GBPm GBPm
--------------------------------- ------- ------- ------ ------
Underlying operating profit 44.9 40.1
Finance costs, finance
income and share based
payments (12.4) (4.7)
Operation based divisions
Transport & Distribution 29.7 27.7
Biomass 4.0 1.2
Infrastructure & Civil
Engineering 3.2 4.4
Asset based divisions
Air (0.7) (0.4)
Estates 6.5 12.4
Central costs and eliminations (10.2) (9.9)
Underlying profit before
tax 32.5 35.4
Separately disclosed items 3.5 (6.2)
--------------------------------- ------- ------- ------ ------
Profit before tax and
discontinued operations 36.0 29.2
--------------------------------- ------- ------- ------ ------
The prior year figures have been restated to classify the
chilled transport pallet network business as a discontinued
operation and for completion of the accounting for the acquisition
of WADI Properties Limited in accordance with accounting
standards.
Autologic Holdings plc
The Group acquired 100% of the share capital of Autologic
Holdings plc on 10 August 2012 for GBP13.0m including fees. This
business contributed revenue of GBP69.4m and underlying profit
before tax of GBP1.4m since acquisition.
On 21 January 2013 the Group disposed of the non-core UK Vehicle
Services business for cash proceeds of GBP11.0m realising a profit
on disposal of GBP8.5m.
Earnings per share
Basic earnings per share from continuing operations increased to
9.0p (2012: 8.5p) and total basic earnings per share were 5.1p
(2012: 8.4p).
Taxation
The tax charge on continuing operations of GBP5.1m (2012:
GBP1.4m) is at an effective rate of 14.2% (2012: 4.9%). The
effective rate has been reduced by GBP2.3m due to the impact of the
change in corporation tax rate on the deferred tax balances and by
GBP2.2m due to the impact of the profit on disposal of the Vehicle
Services division being non-taxable.
Discontinued operation
During the second half of the year the Group decided to
discontinue the chilled transport pallet network business. The
revenue from this discontinued activity was GBP45.0m (2012:
GBP60.2m) and the loss after tax was GBP13.4m (2012: GBP0.3m). This
has been shown separately in the consolidated income statement and
the prior year figures have been restated for consistency. We do
not expect further significant costs in relation to this business
in the current year.
Statement of Financial Position
We have a strong balance sheet with net assets of GBP462.1m
(2012: GBP471.0m). The net asset position was reduced by GBP9.5m
through the purchase of treasury shares during the year.
Non-current assets
Property, plant and equipment increased to GBP312.2m (2012:
GBP280.6m) principally due to the capital developments at London
Southend Airport and at our Widnes site along with inclusion of the
Autologic assets.
Investments in associates and joint ventures has increased to
GBP16.1m (2012: GBP1.1m) following the additional investment in the
restructured Aer Arann business and related aircraft financing
company as well as increases in the value of property interests
held. GBP7.1m of this investment is yet to be paid in cash.
Investment properties were carried at GBP89.5m (2012: GBP98.5m)
after sales of 3 properties in the year whilst there were valuation
uplifts of GBP5.2m on others.
Intangible assets increased to GBP286.2m (2012: GBP281.5m)
following the acquisition of Autologic Holdings plc in the year.
Included in intangible assets are our valuable brand names,
trademarks and designs.
Funding
The net debt of the Group has increased to GBP216.4m (2012:
GBP166.0m). This is principally due to capital expenditure at
London Southend Airport of GBP23.0m, the acquisition of Autologic
Holdings plc of GBP15.4m including fees and overdraft acquired, the
purchase of treasury shares of GBP9.5m and joint venture
investments totaling GBP7.0m. The net debt includes a new three
year GBP20.0m committed revolving credit facility (drawn at
GBP10.0m), and a new twelve month rolling GBP90.0m invoice
discounting facility (drawn at GBP16.4m). There is also a new two
year GBP3.2m property loan acquired on the Autologic
transaction.
These new facilities further diversify the Group's funding base
and provide additional standby liquidity and a balance of
maturities complementing the existing 2020 facility with M&G UK
Companies Financing Fund (drawn at GBP100.0m) and the 2017
Moneypenny bank loan (drawn at GBP77.3m).
The finance lease liabilities have increased to GBP39.0m
(2012:GBP28.8m) largely due to finance leases acquired with
Autologic.
The gearing ratio* is 46.8% (2012: 35.3%) and the gearing ratio
ignoring fleet financing* is 38.4% (2012: 29.1%).
The Group tracks cash flow headroom and covenants on a rolling
12 month basis to ensure any issues are identified at an early
stage.
*Gearing ratio: The gearing ratio is calculated as a percentage
of net debt to net assets. The gearing ratio ignoring fleet
financing is a percentage of net debt (excluding obligations under
finance leases and hire purchase contracts) to net assets.
Cashflow
Cash generated from continuing operations was GBP41.4m (2012:
GBP59.0m). The decrease is due to timing of working capital
movements, in particular the late payment of a single supplier
payment of GBP6.6m in the prior year but paid on time in the
current year. Operating cash outflow from discontinued operations
was GBP9.5m.
Cash outflow for capital expenditure in the year totalled
GBP45.2m (2012: GBP93.4m). This includes development expenditure at
London Southend Airport of GBP23.0m mainly for the new hotel and
terminal extension. Other capex includes GBP10.6m for commercial
vehicles, GBP5.8m further development at the Widnes multimodal
site, which was partly funded by a Grant, and GBP3.1m for
development of 37 Soho Square.
Cash received from disposal of property, plant and equipment was
GBP23.4m (2012: GBP44.8m). This principally relates to disposals of
commercial vehicles and a property at 22 Soho Square, London. Cash
inflow from disposal of assets held for sale of GBP11.7m relates
mainly to the disposal of the units held in One Plantation Place
Unit Trust.
Interest paid in cash totalled GBP12.9m (2012: GBP4.4m). The
increase from the prior year is due to the interest on the loan
against the Moneypenny portfolio and also in the prior year
interest was capitalised during the significant building period at
London Southend Airport. Interest received totalled GBP0.7m (2012:
GBP2.0m).
Dividends paid totalled GBP20.9m (2012: GBP17.6m) reflecting an
increased number of shares but the same annual dividend rate of 6p
(2012: 6p).
Dividends
The Board proposes a final dividend of 4p (2012: 4p) bringing
the total dividend for the year to 6p (2012: 6p). Subject to
approval of shareholders the final dividend will be payable to
investors on record on 24 May 2013 with an Ex-dividend date of 22
May 2013 and will be paid on 5 July 2013. A scrip dividend
alternative will also be made available.
Ben Whawell
Consolidated Income Statement
For the year to 28 February 2013
Restated
2013 2012
GBP'000 GBP'000
Continuing operations
Revenue 572,412 491,673
----------------------------------- ---------- ----------
Operating expenses - underlying (534,173) (463,711)
Share of post tax profits
of associates and joint ventures 997 500
Gain in value of investment
properties 5,173 500
Profit on sale and leaseback
transaction - 5,385
Profit on disposal of/gain
in value of assets held for
sale 495 5,740
----------------------------------- ---------- ----------
Underlying operating profit 44,904 40,087
Share based payments (1,244) (391)
Profit on disposal of business 8,511 -
Credit for business purchase - 821
New territory and new business
set up costs (1,020) (3,415)
Transaction costs (2,759) (1,816)
Restructuring costs (793) (1,592)
Amortisation of acquired
intangibles (381) (222)
----------------------------------- ---------- ----------
Profit before interest and
tax 47,218 33,472
Finance costs (11,963) (6,279)
Finance income 777 1,980
----------------------------------- ---------- ----------
Profit before tax 36,032 29,173
Tax (5,101) (1,441)
----------------------------------- ---------- ----------
Profit from continuing operations 30,931 27,732
Discontinued operation
Loss from discontinued operation,
net of tax (13,409) (276)
----------------------------------- ---------- ----------
Profit for the year 17,522 27,456
----------------------------------- ---------- ----------
Profit attributable to:
Owners of the company 17,519 27,456
Non-controlling interests 3 -
----------------------------------- ---------- ----------
Profit for the year 17,522 27,456
----------------------------------- ---------- ----------
Earnings per share - continuing
operations
Basic 9.02p 8.53p
Diluted 8.98p 8.52p
------------------------------- ------ ------
Earnings per share
Basic 5.11p 8.44p
Diluted 5.09p 8.43p
------------------ ------ ------
Consolidated Statement of Comprehensive Income
For the year to 28 February 2013
Restated
2013 2012
GBP'000 GBP'000
---------------------------------------- -------- --------
Profit for the year 17,522 27,456
Exchange differences on translation
of foreign operations 559 (293)
Cash flow hedge 476 (456)
Revaluation of property, plant and
equipment 781 -
Defined benefit plan actuarial gains 649 -
Tax on items relating to components
of other comprehensive income (414) 114
---------------------------------------- -------- --------
Other comprehensive income / (expense)
for the year, net of tax 2,051 (635)
Total comprehensive income for the
year 19,573 26,821
---------------------------------------- -------- --------
Total comprehensive income attributable
to:
---------------------------------------- -------- --------
Owners of the company 19,570 26,821
---------------------------------------- -------- --------
Non-controlling interests 3 -
---------------------------------------- -------- --------
Total comprehensive income for the
year 19,573 26,821
---------------------------------------- -------- --------
Consolidated Statement of Financial Position
As at 28 February 2013
Restated
2013 2012
GBP'000 GBP'000
Non-current Assets
Property, plant
and equipment
* Land and buildings 247,497 228,447
* Plant and machinery 32,118 20,746
* Fixtures, fittings and equipment 5,338 4,845
* Commercial vehicles 27,215 26,591
---------------------------------------------- ----------------- ---------
312,168 280,629
Investment in associates
and joint ventures 16,086 1,100
Investment property 89,526 98,453
Intangible assets 286,214 281,523
Other investments 7 10
Other receivables 4,930 4,111
708,931 665,826
---------------------------- ------- -------
Current Assets
Inventories 4,251 2,494
Corporation tax 1,338 -
Trade and other receivables 128,869 105,648
Cash and cash equivalents 32,488 31,044
Assets of disposal
groups classified
as held for sale 10,700 7,790
---------------------------- ------- -------
177,646 146,976
---------------------------- ------- -------
Total Assets 886,577 812,802
---------------------------- ------- -------
Non-current Liabilities
Loans and borrowings 215,707 179,241
Defined benefit pension
scheme 4,794 -
Other liabilities 21,348 16,861
Deferred tax 26,905 29,159
268,754 225,261
---------------------------- ------- -------
Current Liabilities
Trade and other payables 122,542 97,709
Loans and borrowings 33,194 17,852
Corporation tax - 1,020
155,736 116,581
---------------------------- ------- -------
Total Liabilities 424,490 341,842
---------------------------- ------- -------
Net Assets 462,087 470,960
---------------------------- ------- -------
Consolidated Statement of Financial Position, Continued
As at 28 February 2013
Restated
2013 2012
GBP'000 GBP'000
---------------------------------- -------- --------
Capital and reserves
Issued share capital 35,397 35,397
Share premium 300,788 300,788
Foreign currency exchange reserve (212) (771)
Reserve for own shares held by
employee benefit trust (386) (488)
Hedge reserve (1,032) (1,423)
Revaluation reserve 781 -
Retained earnings 126,748 137,457
Group Shareholders' Equity 462,084 470,960
Non-controlling interest 3 -
---------------------------------- -------- --------
Total Equity 462,087 470,960
---------------------------------- -------- --------
Consolidated Statement of Changes in Equity
Reserve
for
Foreign Own
Issued Currency Shares
Share Share Exchange held Hedge Revalua-tion Retained Non-controlling Total
capital Premium Reserve by EBT Reserve Reserve Earnings Total interests Equity
---------------- -------- -------- --------- -------- -------- ------------- --------- --------- ---------------- ---------
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 1
March
2012 as
previously
reported 35,397 300,788 (771) (488) (1,423) - 139,203 472,706 - 472,706
Prior period
adjustment - - - - - - (1,746) (1,746) - (1,746)
---------------- -------- -------- --------- -------- -------- ------------- --------- --------- ---------------- ---------
Restated
balance
at 1 March
2012 35,397 300,788 (771) (488) (1,423) - 137,457 470,960 - 470,960
Profit for the
year - - - - - - 17,519 17,519 3 17,522
Other
comprehensive
income for the
year - - 559 - 391 781 320 2,051 - 2,051
---------------- -------- -------- --------- -------- -------- ------------- --------- --------- ---------------- ---------
Total
comprehensive
income/expense
for
the year - - 559 - 391 781 17,839 19,570 3 19,573
Employee
benefit
trust shares
vested - - - 102 - - - 102 - 102
Share based
payment
credit - - - - - - 1,544 1,544 - 1,544
Tax on share
based
payment - - - - - - 278 278 - 278
Purchase of
treasury
shares - - - - - - (9,519) (9,519) - (9,519)
Dividends - - - - - - (20,851) (20,851) - (20,851)
---------------- -------- -------- --------- -------- -------- ------------- --------- --------- ---------------- ---------
Balance at 28
February
2013 35,397 300,788 (212) (386) (1,032) 781 126,748 462,084 3 462,087
---------------- -------- -------- --------- -------- -------- ------------- --------- --------- ---------------- ---------
For the year to 28 February 2013
Consolidated Statement of Changes in Equity
For the year to 29 February 2012
Reserve
for
Foreign Own
Issued Currency Shares Restated
Share Share Exchange held Hedge retained Restated
capital Premium Reserve by EBT Reserve Earnings Total
--------------------- --------- --------- ---------- -------- --------- ---------- ---------
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 1 March
2011 26,517 181,168 (478) (663) (1,081) 126,246 331,709
Profit for the
year - - - - - 27,456 27,456
Other comprehensive
expense for the
year - - (293) - (342) - (635)
--------------------- --------- --------- ---------- -------- --------- ---------- ---------
Total comprehensive
income/(expense)
for the year - - (293) - (342) 27,456 26,821
Proceeds on share
issues 8,880 124,969 - - - - 133,849
Share issue costs - (5,349) - - - - (5,349)
EBT shares vested - - - 175 - - 175
Share based payment
credit - - - - - 886 886
Tax on share based
payment credit - - - - - 447 447
Dividends - - - - - (17,578) (17,578)
--------------------- --------- --------- ---------- -------- --------- ---------- ---------
Balance at 29
February 2012 35,397 300,788 (771) (488) (1,423) 137,457 470,960
--------------------- --------- --------- ---------- -------- --------- ---------- ---------
Consolidated Cash Flow Statement
For the year to 28 February 2013
Restated
2013 2012
GBP'000 GBP'000
---------------------------------------- -------- --------
Cash generated from continuing
operations 41,395 58,992
Cash outflow from discontinued
operations (9,483) (1,354)
Income taxes paid (3,707) (2,191)
---------------------------------------- -------- --------
Net cash flow from operating activities 28,205 55,447
Acquisition of subsidiaries and
other businesses - net of cash
acquired (16,676) (9,602)
Disposal of subsidiaries - net
of cash disposed 13,088 -
Purchase of property, plant and
equipment (45,202) (93,400)
Proceeds from the sale of property,
plant and equipment 23,353 44,786
Proceeds from disposal of assets
held for sale 11,727 -
VAT outflow in relation to sale
and leaseback of property in prior
year (4,583) -
Net loans advanced to associates
and joint ventures (7,038) (1,925)
Interest received 673 1,980
---------------------------------------- -------- --------
Net cash flow from investing activities (24,658) (58,161)
---------------------------------------- -------- --------
Issue of ordinary shares less cost
of issue - 114,527
Dividend paid on ordinary shares (20,851) (17,578)
Proceeds from new finance leases 18,489 14,469
Repayment of capital element of
finance leases (16,173) (30,753)
Proceeds from new borrowings 38,626 2,028
Repayment of borrowings (16,852) (17,273)
Purchase of treasury shares (9,519) -
Proceeds from grant 3,000 -
Interest paid (12,936) (4,359)
Other finance costs (819) -
Net cash flow from financing activities (17,035) 61,061
---------------------------------------- -------- --------
(Decrease) / increase in cash and
cash equivalents (13,488) 58,347
Cash and cash equivalents at beginning
of year 26,401 (31,946)
---------------------------------------- -------- --------
Cash and cash equivalents at end
of year 12,913 26,401
---------------------------------------- -------- --------
Cash (includes GBP12.7m restricted
cash) 32,488 31,044
Overdraft (19,575) (4,643)
---------------------------------------- -------- --------
Cash and cash equivalents at end
of year 12,913 26,401
---------------------------------------- -------- --------
Accounting Policies
Basis of Preparation and statement of compliance
The accounting policies have been consistently applied to all
the years presented, unless otherwise stated.
The financial information set out in this preliminary
announcement is derived from but does not constitute the Group's
statutory accounts for the year ended 28 February 2013 and year
ended 29 February 2012 and, as such, does not contain all
information required to be disclosed in the financial statements
prepared in accordance with International Financial Reporting
Standards ("IFRS"). The financial information has been extracted
from the Group's audited consolidated statutory accounts upon which
the auditors issued an unqualified opinion.
The preliminary announcement has been prepared on the same basis
as the accounting policies set out in the previous year's financial
statements, except as noted below.
The financial statements of the Group are also prepared in
accordance with the Companies (Guernsey) Law 2008.
Stobart Group Limited is a Guernsey registered company. The
Company's ordinary shares are traded on the London Stock
Exchange.
The financial statements have been prepared on a Going Concern
basis.
The Group's business activities, together with factors likely to
affect its future performance and position, are set out in the
Chief Executive Officer's Report and the financial position of the
Group, its cash flows and funding are set out in the Operational
and Financial Review.
The Group has considerable financial resources, together with
contracts with a number of customers and suppliers. The financial
forecasts show that borrowing facilities are adequate such that the
Group can operate within these facilities and meet its obligations
when they fall due for the foreseeable future. As a consequence,
the Directors believe that the Group is well placed to manage its
business risks successfully despite the current economic
climate.
After making enquiries, the Directors have a reasonable
expectation that the Group has adequate resources to continue in
operational existence for the forseeable future. Accordingly, the
financial statements have been prepared on a going concern
basis.
Restatement of 29 February 2012 Financial Information
The results of the Chilled transport business for the year to 29
February 2012 have been restated as discontinued operations. This
is required by IFRS 5 to be consistent with the treatment in the
current year.
The accounting for the acquisition of WADI Properties Limited in
the prior year has been amended to revise the provisional
assessment of fair values at acquisition and to reflect the agreed
position as set out in the completion accounts. This is a hindsight
adjustment to acquisition fair values as permitted by IFRS 3.
Separately disclosed items
On 21 January 2013, the Group disposed of the non-core UK
Vehicle Services business of Stobart Automotive for GBP11.0m. This
business had been acquired in August 2012 as part of the
acquisition of Autologic Holdings plc. The profit on disposal of
GBP8.5m has been included in profit on disposal of business in the
income statement.
New territory and new business set up costs of GBP1.0m (2012:
GBP3.4m) comprise costs of investing in new major territories or
significant areas of business to commence or accelerate development
of our business presence. These costs include establishment costs,
legal and professional fees, losses and certain staff and training
costs. The current year costs were in relation to the development
of the major new businesses at London Southend Airport. The prior
year exceptional costs were in relation to the development of
businesses in Ireland and also at London Southend Airport.
Transaction costs comprise the costs of making investments in
new businesses or costs of financing transactions that are not
permitted to be debited to the cost of investment or as issue
costs. These costs include the costs of any aborted
transactions.
Restructuring costs comprise costs of major integration plans
and other business reorganisation and restructuring undertaken by
management. Costs include cost rationalisation, brand
harmonisation, site closure costs, certain short term duplicated
costs, directly related management time, asset write downs and
other costs related to the reorganisation and integration of
acquired and new businesses. These are principally expected to be
one-off in nature.
Segmental information
The operating segments within continuing operations are Stobart
Transport & Distribution, Stobart Estates, Stobart
Infrastructure & Civil Engineering, Stobart Air and Stobart
Biomass.
The Stobart Transport & Distribution segment specialises in
contract logistics including road
haulage, rail freight, ports handling and warehousing.
The Stobart Estates segment specialises in management,
development and realisation of land and buildings assets.
The Stobart Infrastructure & Civil Engineering segment
specialises in delivering internal and external infrastructure and
development projects including rail network operations.
The Stobart Air segment specialises in operation of commercial
airports.
The Stobart Biomass segment specialises in supply of sustainable
biomass for the generation
of renewable energy.
The Executive Directors are regarded as the Chief Operating
Decision Maker (CODM). The
Directors monitor the results of its business units separately
for the purposes of making
decisions about resource allocation and performance assessment.
The main segmental profit
measures are earnings before interest, tax, depreciation and
amortisation and also profit
before tax both shown before separately disclosed items.
Income taxes, non-fleet finance costs and certain central costs
are managed on a Group basis and are not allocated to operating
segments. These costs are included in adjustments and
eliminations.
Period ended Stobart Stobart
28 February Transport Infrastructure
2013 & Stobart & Civil Stobart Stobart Adjustments
Distribution Estates Engineering Air Biomass and eliminations Group
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------ -------------- ---------- ---------------- --------- --------- ------------------ ----------
Revenue
External 514,419 15,580 11,062 14,938 16,402 11 572,412
Internal 2,753 1,234 19,800 - - (23,787) -
------------------ -------------- ---------- ---------------- --------- --------- ------------------ ----------
Total revenue 517,172 16,814 30,862 14,938 16,402 (23,776) 572,412
------------------ -------------- ---------- ---------------- --------- --------- ------------------ ----------
Depreciation (9,908) (1,448) (1,469) (921) (109) (824) (14,679)
Share of profit
of associates
and joint
ventures 126 203 - - - (441) (112)
Reversal of
write downs
of assets - 1,109 - - - - 1,109
Gain in value
of investment
properties - 5,173 - - - - 5,173
Profit on
disposal of/gain
on property
asset held
for sale - 495 - - - - 495
Share based
payments - - - - - (1,244) (1,244)
------------------ -------------- ---------- ---------------- --------- --------- ------------------ ----------
Segment EBITDA 40,923 17,084 4,876 441 4,132 (9,117) 58,339
------------------ -------------- ---------- ---------------- --------- --------- ------------------ ----------
Segment PBT 29,692 6,524 3,157 (673) 3,953 (10,179) 32,474
------------------ -------------- ---------- ---------------- --------- --------- ------------------ ----------
Credit for
business purchase -
Profit on
disposal of
business 8,511
New territory
and new business
set-up costs (1,020)
Transaction
costs written
off (2,759)
Restructuring
costs
Amortisation (793)
of acquired
Intangibles (381)
------------------ -------------- ---------- ---------------- --------- --------- ------------------ ----------
Profit before
tax 36,032
------------------ -------------- ---------- ---------------- --------- --------- ------------------ ----------
Assets
Equity accounted
investments 625 2,412 - - - 13,049 16,086
Additions
to non-current
assets 13,634 5,825 590 23,021 1,020 139 44,229
Operating
assets 406,305 356,191 13,550 25,465 60,804 24,262 886,577
Operating
liabilities (181,744) (171,776) (14,672) (26,846) (4,804) (24,648) (424,490)
------------------ -------------- ---------- ---------------- --------- --------- ------------------ ----------
Net assets 224,561 184,415 (1,122) (1,381) 56,000 (386) 462,087
------------------ -------------- ---------- ---------------- --------- --------- ------------------ ----------
Period ended Restated
29 February Stobart Stobart
2012 Transport Infrastructure
Restated & Stobart & Civil Stobart Stobart Adjustments Restated
Distribution Estates Engineering Air Biomass and eliminations Group
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Revenue
------------------ -------------- ---------- ---------------- --------- --------- ------------------ ----------
External 454,604 6,708 13,128 8,792 8,404 37 491,673
Internal 4,627 - 44,048 - - (48,675) -
------------------ -------------- ---------- ---------------- --------- --------- ------------------ ----------
Total revenue 459,231 6,708 57,176 8,792 8,404 (48,638) 491,673
------------------ -------------- ---------- ---------------- --------- --------- ------------------ ----------
Depreciation (13,918) (224) (1,066) (258) (63) (178) (15,707)
Share of
profit of
associates
and joint
ventures - - - - 100 - 100
Reversal
of write
downs of
assets - 400 - - - - 400
Profit on
disposal
of sale and
leaseback
transaction - 5,385 - - - - 5,385
Gain on property
asset held
for sale - 5,740 - - - - 5,740
Share based
payment - - - - - (391) (391)
------------------ -------------- ---------- ---------------- --------- --------- ------------------ ----------
Segment EBITDA 44,312 13,605 5,641 (167) 1,297 (9,285) 55,403
------------------ -------------- ---------- ---------------- --------- --------- ------------------ ----------
Segment PBT 27,673 12,405 4,387 (436) 1,170 (9,802) 35,397
Credit for
business
purchase 821
New territory
business
set-up costs (3,415)
Transaction
costs written
off (1,816)
Restructuring
costs (1,592)
Amortisation
of acquired
intangibles (222)
------------------ -------------- ---------- ---------------- --------- --------- ------------------ ----------
Profit before
tax 29,173
------------------ -------------- ---------- ---------------- --------- --------- ------------------ ----------
Assets
Equity accounted
investments - 8,890 - - - - 8,890
Additions
to non-current
assets 15,410 69,333 4,260 3,289 102 318 92,712
Operating
assets 417,835 307,855 15,245 11,139 54,326 6,402 812,802
Operating
liabilities (164,349) (115,880) (18,703) (24,460) (2,110) (16,340) (341,842)
------------------ -------------- ---------- ---------------- --------- --------- ------------------ ----------
Net assets 253,486 191,975 (3,458) (13,321) 52,216 (9,938) 470,960
------------------ -------------- ---------- ---------------- --------- --------- ------------------ ----------
Inter-segment revenues are eliminated on consolidation.
Included in adjustments and eliminations are central costs of
GBP8,421,000 (2012: GBP5,440,000), intra-group profit of
GBP1,758,000 (2012: GBP2,589,000) and other costs attributable to
internal capital developments not capitalised in the Group accounts
of GBPnil (2012: GBP1,773,000).
Also included in adjustments and eliminations are central assets
and liabilities excluding assets and liabilities where it has been
deemed appropriate to allocate to an operating segment.
Dividends
Dividends Paid on Ordinary Shares
2013 2013 2012 2012
Rate Rate
p GBP'000 p GBP'000
------------------------ ---- ------- ---- -------
Final dividend for 2012
paid 6 July 2012 4.0 13,921 - -
Interim dividend paid
7 December 2012 2.0 6,930 - -
Final dividend for 2011
paid 7 July 2011 - - 4.0 10,607
Interim dividend paid
9 December 2011 - - 2.0 6,971
------------------------ ---- ------- ---- -------
Dividends paid 6.0 20,851 6.0 17,578
------------------------ ---- ------- ---- -------
A final dividend of 4.0p per share totalling GBP14,158,435 was
declared on 16 May 2013 and subject to approval of shareholders
will be paid on 5 July 2013. This is not recognised as a liability
as at 28 February 2013.
Business combinations
Acquisitions in the year ended 28 February 2013
Acquisition of Autologic Holdings plc
On 10 August 2012 the Group acquired 100% of the voting rights
of Autologic Holdings plc ("Autologic"), an AIM listed company
based in the United Kingdom and a leading provider of distribution
and technical services to the automotive industry. The business has
now been rebranded as Stobart Automotive and is included in the
Transport & Distribution segment.
The provisional fair value of the identifiable assets and
liabilities of Autologic as at the date of acquisition have been
identified as follows:
Provisional
fair value Previous
recognised carrying
on acquisition value
GBP'000 GBP'000
---------------- ----------
Property, plant and equipment 22,957 18,795
Goodwill - 21,934
Investments in associates
and joint ventures 452 452
Intangible assets: customer
relationships 1,407 121
Cash and cash equivalents 3,502 3,502
Trade and other receivables 31,878 31,795
Inventories 947 947
Trade payables (12,504) (12,504)
Other payables and deferred
income (21,169) (17,628)
Loans and borrowings (15,657) (14,305)
Pension scheme liabilities (5,846) (5,102)
Deferred tax 1,101 1,705
----------
Net assets 7,068 29,712
Goodwill arising on acquisition 5,380
----------------
Total consideration 12,448
----------------
The total cost of the combination was GBP12.4m and was comprised
of cash consideration. There was no contingent consideration as
defined in IFRS 3 'Business Combinations' in connection with this
acquisition.
The primary reason for the acquisition was to enter a new market
for the Group. The goodwill of GBP5.4m is deemed to be attributable
to the acquired significant presence in the automotive sector, the
value of the existing management structure and workforce within
Autologic and the efficiencies, costs reductions and economies of
scale expected to be derived from combining Autologic with the
existing operations of the Group. None of the goodwill generated on
acquisition is expected to be deductible for tax purposes, although
GBP1.0m of the pre-existing goodwill in the Autologic group remains
deductible for tax.
The fair value of the acquired identifiable intangible assets in
respect of customer relationships of GBP1.4m represents
management's assessment of the value of the existing contractual
and non-contractual relationships.
Transaction costs related to the acquisition of GBP0.6m have
been recognised as an expense in the Consolidated Income
Statement.
Acquisitions in the year ended 29 February 2012
Acquisition of WADI Properties Limited
On 28 February 2012 the Group acquired the entire issued share
capital of WADI Properties Limited. WADI Properties Limited is an
unlisted company registered in the United Kingdom and is the
holding company for a number of companies whose principal activity
is property investment. Transaction costs related to the
acquisition of GBP1,044,000 were recognised as an expense in
transaction costs written off in the Consolidated Income
Statement.
The fair value of the identifiable assets and liabilities of
WADI Properties Limited at the date of acquisition were as
follows:
Fair value
recognised
on acquisition
(restated)
GBP'000
Investment properties 89,943
Property, plant and equipment 2,037
Trade and other receivables 1,151
Cash and cash equivalents 207
Trade payables (157)
Other payables and deferred income (2,717)
Corporation tax (153)
Loans and borrowings (87,692)
Deferred tax 11,448
----------------
Net assets acquired 14,067
Excess of fair value of net assets
acquired over cost (821)
----------------
Total consideration 13,246
----------------
The net assets and the provision for deferred consideration
recognised in the provisional acquisition accounting to 29 February
2012 were both based on a provisional assessment of fair values,
due to the proximity of the acquisition to the Group's year end and
also the incomplete status of the completion accounts process.
The assessment of fair values and the completion accounts
process were both concluded in the year, which resulted in the
following adjustments:
-- A reduction of GBP1,150,000 in the fair value of one of the investment properties acquired
-- A reduction in trade and other receivables acquired of GBP53,000
-- An increase in other payables acquired of GBP13,000
-- A reduction in the corporation tax liability of GBP572,000
-- An increase in the deferred tax asset of GBP294,000
In concluding the completion accounts process, the outstanding
completion accounting issues were also resolved from the disposal
of Moneypenny Limited and Westbury Schools Limited by Stobart Group
Limited (then Westbury Property Fund) to WADI Properties Limited,
in September 2007. The outcome of this process is a reduction of
GBP1,017,000 in the consideration paid by WADI Properties Limited
to Stobart Group Limited in September 2007. This amount is owed to
WADI Properties Limited and has been incorporated into the
completion accounts process for the purchase of WADI Properties
Limited by Stobart Group outlined above.
As a result of the resolution of these outstanding completion
accounts issues, additional consideration of GBP1,396,000 has
become payable. The total consideration of GBP13,246,000 comprised
the initial share consideration of GBP6,700,000 and the cash
consideration of GBP6,546,000. The initial share consideration was
satisfied by the issue of 5,399,742 ordinary shares at a fair value
of GBP1.24 each. This share price was the market price at the date
of acquisition.
The excess of the fair value of the assets and liabilities
acquired over the cost of the acquisition represents a bargain
purchase and has been recognised in the income statement, presented
as 'credit for business purchase'. As a result of the above
adjustments the credit for business purchase has been restated to
GBP821,000.
Financial assets and liabilities
2013 2012
Loans and borrowings GBP'000 GBP'000
--------------------------------------------------------------- -------- --------
Non-current
Fixed rate
- Obligations under finance leases
and hire purchase contracts 27,181 15,750
- Loan notes 3,745 7,779
- Bank loans 68,659 74,828
Variable rate:
- Obligations under finance leases
and hire purchase contracts 379 2,402
- Bank loans 115,743 78,482
215,707 179,241
--------------------------------------------------------------- -------- --------
Current
Fixed rate
- Obligations under finance leases
and hire purchase contracts 10,353 9,293
- Bank loans 1,400 -
Variable rate:
* Obligations under finance lease and hire purchase
contracts 1,120 1,404
- Overdrafts 3,156 4,643
- Invoice Discounting Facility 16,418 -
- Bank loans 747 2,512
--------------------------------------------------------------- -------- --------
33,194 17,852
--------------------------------------------------------------- -------- --------
Total loans and borrowings 248,901 197,093
Cash 32,488 31,044
--------------------------------------------------------------- -------- --------
Net Debt 216,413 166,049
--------------------------------------------------------------- -------- --------
The obligations under finance leases and hire purchase contracts
are taken out with various lenders at fixed or variable interest
rates prevailing at the inception of the contracts.
The bank loans at the year end include a GBP100m variable rate
group finance arrangement due for repayment in the following
proportions; 25% May 2018, 25% May 2019 and 50% May 2020. This
facility is subject to a number of financial and non financial
covenants. The Group currently have a committed offer from the
lender for certain amendments to these covenants, which it is in
the company's control to accept, and which the directors are
currently considering. Also included in bank loans is a GBP77.3m
property loan. The property loan is due for repayment in quarterly
installments ending April 2017. This loan has fixed and variable
elements of GBP72.3m (2012: GBP74.8m) and GBP5.0m (2012: GBP12.9m)
respectively at 28 February 2013. The bank loans also include
GBP10m drawn on a GBP20m variable rate committed revolving credit
facility with facility end date of Feb 2016.
Included in cash is GBP12.7m which is held in an asset proceeds
account and as at 29 February 2013 its use was restricted to
reinvestment in new property assets or repayment of the property
loan.
The overdraft facility is secured on working capital and bears
interest at 2.25% above the Bank of England base rate.
The variable rate invoice discounting facility is secured on
receivables.
The loan notes were issued in connection with the acquisition of
Stobart Biomass Products Limited on 19 May 2011 and are repayable
on 23 May 2014.
The Group was in compliance with financial covenants throughout
the year and the previous year.
Notes to the consolidated cash flow statement
Restated
Cash generated from continuing 2013 2012
operations GBP'000 GBP'000
---------------------------------------- --------- ----------
Profit before tax on continuing
operations 36,032 29,173
Adjustments to reconcile profit
before tax to net cash flows
Non-cash:
Movement in unrealised gain on
revaluation of investment properties (5,173) (500)
Realised profit on sale of property,
plant and equipment (866) (7,902)
Share of post tax profits of associates
& joint ventures accounted for
using the equity method (997) (100)
Profit on disposal of business (8,511) -
Profit on disposal of assets held
for sale (495) (5,740)
Reversal of writedown of loan
to joint venture - (400)
Depreciation of property, plant
and equipment 14,679 15,707
Finance income (777) (1,980)
Interest expense 11,963 6,279
Release of grant income (199) -
Non-operating transaction costs 2,759 -
Amortisation of intangible assets 381 222
Credit for business purchase - (821)
Share option charge 1,406 391
Working capital adjustments:
(Increase)/decrease in inventories (1,909) 151
(Increase)/decrease in trade and
other receivables (1,535) 2,197
(Decrease)/increase in trade and
other payables (5,363) 22,315
Cash generated from continuing
operations 41,395 58,992
---------------------------------------- --------- ----------
Related Parties
Relationships of Common Control or Significant Influence
WADI Properties Limited was formerly owned by WA Developments
International Limited, a company owned by W A Tinkler and W Stobart
who are significant shareholders, directors and key management of
the Group. On 28 February 2012, WADI Properties Limited was
acquired by the group for a total consideration of GBP13.2m.
WA Developments International Limited is owned by W A Tinkler
and W Stobart. The Group made purchases totalling GBP78,000 (2012:
GBP72,000) from and sales totalling GBP537,000 (2012: GBP282,000)
to WA Developments International Limited. GBP990,000 (2012:
GBP789,000) was due from and GBP340,000 (2012: GBP404,000) was due
to WA Developments International Limited at the year end.
VLL Limited is a subsidiary of WA Developments International
Limited. During the year, the Group made sales of GBP17,000 (2012:
GBP57,000) and made purchases of GBP826,000 (2012: GBP569,000)
relating to the provision of passenger transport from VLL Limited.
GBP193,000 (2012: GBP86,000) was owed to the Group at the year end
and GBP100,000 (2012: GBPnil) was owed by the Group to VLL Limited
at the year end.
During the year the Group made purchases of GBP550,000 (2012:
GBP652,000) from Ast Signs Limited, a company in which W Stobart
holds a 27% shareholding. A balance of GBP61,000 (2012: GBP189,000)
was owed by the Group at the year end.
Associates and Joint Ventures
The Group had loans outstanding from its joint venture interest,
Convoy Limited of GBP2,132,000 (2012: GBP2,132,000) at the year end
of which GBPnil (2012: GBP1,053,000) has been provided for.
The Group had loans outstanding from its joint venture interest,
Westbury Fitness Hull Limited of GBP471,000 (2012: GBP471,000) at
the year end of which GBP471,000 (2012: GBP471,000) has been
provided for.
The Group had loans outstanding from its joint venture interest
Westar Limited of GBP1,995,000 (2012: GBP2,022,000) of which
GBP1,995,000 (2012: GBP1,922,000) has been provided for.
The Group had loans outstanding from companies within its joint
venture interest, Everdeal Holdings Limited of GBP3,031,000 (2012:
GBP4,111,000) at the year end.
The Group had loans outstanding from its associate interest,
Shuban Power Limited of GBP1,570,000 (2012: GBPnil) at the year
end.
The Group had loans outstanding from its joint venture interest,
Stobart Barristers Limited of GBP306,000 (2012: GBPnil) at the year
end. During the year, the Group made purchases of GBP80,000 (2012:
GBPnil) of which GBP54,000 (2012: GBPnil) was owed at the year
end.
The Group made sales of GBP49,000 (2012: GBPnil) and purchases
of GBP11,000 (2012: GBPnil) to its joint venture interest,
Transport Service Klingels Willems NV of which GBP154,000 (2012:
GBPnil) was owed to and GBP94,000 (2012: GBPnil) owed by the Group
at the year end.
The Group made sales of GBP1,684,000 (2012: GBPnil) and
purchases of GBP2,000 (2012: GBPnil) to its joint venture interest,
Vehicle Logistics Corporation BV of which GBP368,000 (2012: GBPnil)
was owed to the Group at the year end.
Post Balance Sheet Events
There are no post balance sheet events that require disclosure
in the accounts.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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