TIDMSTOB
RNS Number : 6591H
Stobart Group Limited
21 May 2014
21 May 2014
Stobart Group Limited
("Stobart" or the "Group")
Preliminary Results for the year ended 28 February 2014
Stobart Group Limited, the infrastructure and support services
group, today announces its results for the year ended 28 February
2014.
Group Overview
-- The Group continued with its stated strategy by realising
good value from its mature assets during the year and post the year
end:
o The partial realisation of a significant proportion of the
Transport & Distribution division in April 2014 generated
significant value, including cash and loan notes of GBP195.6m.
o Property realisations generated GBP73.5m of cash and a 23%
return on investment.
o The significant net debt reduction during the year, with a net
cash position following the realisations, will materially reduce
future interest costs.
-- The growth divisions have made good progress, with attractive
returns from Estates and a solid performance from Infrastructure
and Civil Engineering.
Air
o Extended terminal completed at London Southend Airport with
capacity now to handle over 5 million passengers per annum.
o Passenger numbers through London Southend Airport increased by
38% during the year and now exceed 1 million.
o London Southend Airport is the fastest growing airport across
Europe's 368 airports for the second year running.(1)
o Rated best UK airport for customer satisfaction in Which?
Magazine.
Biomass
o Biomass tonnage supplied increased by 41% to over 900,000
tonnes.
o Major new long term contracts commenced but initial
commissioning issues delayed anticipated profit growth.
o Increasing supply to export markets pending future UK power
plant build out.
o Entered growing small scale market supported by the recent
Renewable Heat Incentive (RHI) legislation.
Infrastructure and Civil Engineering
o Completed London Southend Airport's terminal extension on time
and on budget.
o Revenue from external projects up 40% with an improving order
book.
Estates
o Good asset management initiatives and improving property
market has resulted in solid returns.
Transport & Distribution (Biomass)
o Biomass transport retained by the Group and will be integrated
into the fuel supply business to support long term contracts.
Transport & Distribution (Eddie Stobart Logistics)
o Realised 51% of the remaining transport operation on 10 April
2014, retaining a 49% interest. Reported as a discontinued
operation.
o New management introduced by DBAY Advisors to support William
Stobart and his existing team to take the business to its next
stage.
-- Impairment charge of GBP13.0m resulted from delays in
developments, intended recategorisation of property assets and
change of CGUs caused by the realisation.
Outlook
-- Clear focus on growth businesses with cash reserves available
to develop Energy and Aviation further.
-- A portfolio of property assets to realise at the right time.
The resulting cash flow and profits will contribute to dividend
payments in the short term.
-- Board strengthened with a new Chairman, Iain Ferguson, and
Senior Independent Director, Andrew Wood, appointed during the year
and three further Board members joining in July.
Financial Highlights
Note: The performance of the partially realised Transport and
Distribution operation is shown as a discontinued operation but the
balance sheet does not yet reflect the full impact of the
transaction.
Restated*
2014 2013
Revenue from continuing operations GBP99.2m GBP76.8m
Underlying EBITDA from continuing GBP22.6m GBP21.3m
operations
Depreciation on continuing operations GBP5.8m GBP5.0m
Net interest on continuing operations GBP11.5m GBP10.0m
Underlying profit before tax from GBP5.4m GBP6.3m
continuing operations
Profit for the year from continuing GBP11.3m GBP17.4m
and discontinued operations
Final dividend per share payable
on 4 July 2013 4.0p 4.0p
Total dividend for the year 6.0p 6.0p
Earnings per share from continuing
and discontinued operations 3.3p 5.1p
Net cash generated from continuing GBP33.9m GBP32.6m
and discontinued operations
Book value of property assets and GBP273.2m GBP351.7m
investments
Impairment of property, plant and GBP13.0m -
equipment
Net debt GBP127.9m GBP216.4m
*The results for the year end 28 February 2013 have been
restated to classify the part of the Transport & Distribution
business which was subject to the partial realisation transaction
as discontinued operations and the related assets and liabilities
are classified as held for sale.
Divisional summary - continuing operations
2014 Restated
2013
GBPm GBPm GBPm GBPm
------------------------------------ ----- ------ ----- ------
Earnings before interest, tax,
depreciation and amortisation
(EBITDA)
Biomass 4.4 4.1
Air 0.1 0.4
Infrastructure & Civil Engineering 3.5 4.9
Estates 17.7 17.0
Transport & Distribution 3.7 3.0
------------------------------------ ----- ------ ----- ------
Underlying divisional EBITDA 29.4 29.4
Central costs and eliminations (6.8) (8.1)
------------------------------------ ----- ------ ----- ------
Underlying EBITDA 22.6 21.3
------------------------------------ ----- ------ ----- ------
Andrew Tinkler, Chief Executive Officer, said:
"Looking back over 2013-14, we have made significant steps to
deliver value to our shareholders. Our strategy is now well set as
an infrastructure and support services Group. With capital to
invest and our executive team focused on our growth businesses in
Energy and Aviation, we are well placed to deliver good returns for
our shareholders over the next three years and on into the
future."
Enquiries:
Stobart Group +44 207 851 9090
Andrew Tinkler, Chief Executive
Officer
Ben Whawell, Chief Financial
Officer
Lansons
+44 20 7294 3617
Tony Langham (tonyl@lansons.com) +44 7979 692287
influence Associates +44 20 7287 9610
Stuart Dyble/James Andrew
Source
(1) Airline Network News & Analysis (anna aero).
Chairman's Statement
This is my first report to you as Chairman of Stobart Group. The
last twelve months have been a period of challenge, of change and
of progress for the Group. There have been several significant
developments including a number of well executed sales at good
prices from the Estates Division and the sale of a significant
proportion of the Transport & Distribution (T&D) Division.
There have also been a number of changes in Board membership
reflecting the evolving composition of the Group. Our strategy
remains as outlined in 2011 and is focussed on building and
realising shareholder value from our businesses. In this context we
regularly review divisional performances against market conditions
in order to make the right strategic decisions for each of our
businesses at the right time.
Results
The results for the year look very different from previous
years, as our part-realisation of the value in our T&D
Division, subsequent to the year end, means that this element is
shown as a discontinued operation. Stobart Group is now positioned
as a group with subsidiaries that operate infrastructure and
support services, together with a 49% associate in the formerly
100%-owned T&D Division, Eddie Stobart Logistics Ltd.
Operationally, the T&D Division and the Civil Engineering
Division delivered solid results in the year. The Air and Biomass
businesses achieved encouraging growth with just over 1 million
passengers using Southend Airport and nearly 1 million tonnes of
biomass supplied through the Biomass business. The Estates Division
had a good year with several strong value realisations.
Our part-realisation of the T&D Division has resulted in
certain assets undergoing revised impairment testing analysis and
we have recorded an impairment of GBP13m in the year.
The continuing business delivered an EBITDA of GBP22.6m (2013:
GBP21.3m), with net debt reducing significantly to GBP127.9m (2013:
GBP216.4m). EPS from all operations has fallen to 3.3p (2013: 5.1p)
due to the impairment charge.
The Board
There have been a number of Board changes over the past
year.
Avril Palmer-Baunack was appointed Executive Chairman on 21
January 2013 and stood down from this role on 2 April 2013, leaving
the Group on 15 May 2013.
Paul Orchard-Lisle took on the position of Interim Non-Executive
Chairman between 15 May 2013 and my arrival on 1 October 2013, when
he returned to his role as Non-Executive Director. Paul will stand
down from the Board at the AGM.
Alan Kelsey stood down from the Board on 23 April 2013.
Andrew Wood joined the Board on 1 November 2013 as
Senior-Independent Director. Rodney Baker-Bates stepped down from
the Board on 31 December 2013 having served with dedication and
loyalty for nearly six years, mainly as Chairman.
William Stobart stood down from the Board on 6 March 2014 and is
now the CEO of Eddie Stobart Logistics Ltd. Michael Kayser will
stand down from the Board at the AGM, having served as a
Non-Executive Director and Audit Committee Chairman for six
years.
On 1 July 2014 we will be appointing Richard Butcher to the
Board as an Executive Director and John Coombs and John Garbutt as
Non-Executive Directors. There will be an external review of Board
effectiveness this year.
Dividend
An interim dividend of 2.0p was paid on 6 December 2013. The
Board is proposing a final dividend of 4.0p per ordinary share,
giving a total dividend for the year of 6.0p. As indicated at the
time of the T&D partial disposal, we expect to maintain our
current level of dividend payment and in the short term will fund
it from property disposals.
Outlook
We coped well with a period of economic difficulty and are now
positioned to capitalise on growth. The recent partial disposal of
the T&D Division has enabled us to substantially repay our
debt, to return cash to shareholders through a share buy back
exercise and to address investment opportunities in our growth
divisions. Importantly, this transaction and the resulting changed
shape of our Group, with its revised structure, will allow the
senior team to focus their skills and energies on accelerating
growth in our Energy and Aviation businesses.
Our strong and diverse property portfolio delivers an attractive
income return. The Estates Division will continue to capitalise on
market-led opportunities to realise its capital and this, alongside
our 49% investment in Eddie Stobart Logistics Ltd, will continue to
deliver a solid return. The Rail Division's underpinning role in
value creation will also remain important.
We remain committed to our strategy and believe that we are
securely positioned to deliver further growth, return and value to
shareholders.
Iain Ferguson CBE
Chief Executive's Report
In this past year, we have made significant steps towards the
realisation of our strategy to deliver value to our shareholders.
We are now in a good shape to continue to do so through focusing
our attention on the key areas for growth; Energy and Aviation.
Coupled with the recent consolidation of operations and assets into
a new, streamlined structure following the partial realisation of a
significant proportion of the Transport & Distribution
Division, we are well placed to accelerate sustainable growth.
This year also provided us with the opportunity to strengthen
the Board. We were able to appoint Iain Ferguson as Chair in
October 2013 and subsequently Andrew Wood as Non-Executive Director
and Senior Independent Director in November 2013. On 1 July 2014 we
will be appointing Richard Butcher to the Board as an Executive
Director and John Coombs and John Garbutt as Non-Executive
Directors. The Board is now strong and has the requisite skill and
expertise profile to support the planned business growth through
the development of both Infrastructure and Support Services.
The part realisation of Transport & Distribution
The recent headline transaction for us has been the partial
realisation of our Transport & Distribution (T&D) Division
that completed in April 2014. This transaction enabled us to repay
the majority of our debt, buy back a proportion of shares and focus
on accelerating growth of the continuing Group. The transaction
valued the business at GBP280.8m comprising GBP195.6m in cash,
GBP44.1m in shares (giving the Group ownership of 49% of the
acquiring company, with 51% owned by funds managed by DBAY
Advisors) and approximately GBP41.1m in debt and debt-like items
assumed by the purchaser. Stobart Group has retained the Eddie
Stobart brand through a licence agreement, the biomass transport
operations (comprising 8% of the vehicle fleet), which is being
integrated into the Stobart Biomass fuel supply business, and three
freehold properties used by the T&D Division. In addition, the
partial disposal means our operating lease commitments have reduced
by GBP253.6m to GBP41.6m.
A number of other retained assets which had links to the T&D
Division had to be reviewed for impairment independently following
the transaction and we have recorded an impairment charge in the
year of GBP13m. We believe there is scope in the medium term to
recover this value.
Stobart Air
2013-14 has been another period of rapid growth at London
Southend Airport (LSA) with passenger numbers now exceeding 1
million. The recent completion and opening of the terminal
extension has increased both capacity to 5 million passengers and
our commercial offering. The new extension includes foreign
exchange bureaus, duty free retail, bars and restaurants.
The creation of a new partnership with Flybe will see our joint
venture airline, Stobart Air, using two branded Flybe aircraft to
launch six new routes into Europe. We understand the importance of
building new routes and new partnerships to help increase passenger
numbers in line with our predictions. We aim to grow again in the
year ahead and this passenger growth should drive our various
revenue streams at the airport. Despite our passenger growth, there
is still work to be done to improve profitability with renewed
focus on revenue per passenger and controlling costs.
We continue to develop plans for Carlisle Lake District Airport
but remain dogged by ongoing challenges around planning. The
airport remains a key priority for development by our Local
Authority partners who are aiming to increase inbound international
visitor numbers to Cumbria and the Lake District.
Stobart Biomass
This past year has seen the consolidation of some major long
term contracts for the Biomass Division, including those with
Iggesund and Helius. We have also signed 15 year fuel supply
agreements with biomass plants at Port Talbot and Evermore.
2013-14 saw tonnage supplied exceeding 900,000 tonnes for the
year (up from circa 650,000 in 2012-13) including Solid Recovered
Fuel (SRF) shipped to Denmark, and a substantial increase in road
exports to both Belgium and France. The year ahead will see us
consolidate our position within the biomass and renewable energy
sectors, making co-investments in targeted developments where we
can ensure solid and sustainable returns.
Mindful of the importance of the supply element of our Biomass
business, we have retained the biomass transport business following
the recent transaction. This means that our comprehensive offering
of fuel source and supply, matched with premier logistics
capability, remains fully intact and we are well placed to increase
our rate of growth of supply throughout the year.
Stobart Estates
This has been another busy year for the Group's Estates Division
which has delivered strong results against the backdrop of a very
challenging property market. Cash of GBP73.5m was generated from
sales, with a profit on disposal of GBP7.3m. The flagship 37 Soho
Square residential development was completed, with every flat
except one sold by year end. Terms have been agreed for the sale of
the final flat and this is expected to complete shortly. The total
profit on this development since the February 2012 acquisition is
GBP5.5m, representing a return on investment of over 43%.
Terms were agreed in the year with GE for substantial repayment
of the secured loan facility, with re-financing completed on 3
March 2014. As a result, GBP68.1m of debt has been repaid along
with associated costs, reducing the outstanding facility to
GBP10.7m, all on flexible variable rate terms.
In addition, the sale and leaseback of Appleton Thorn transport
and warehouse sites in the year delivered a profit on disposal of
GBP3.7m, whilst asset management initiatives and an improving
property market resulted in revaluation gains of GBP4.2m in the
year.
Stobart Estates includes the Group's airport properties. Rental
income from these sites is currently very low since charges are
linked to the Air Division's EBITDA.
Stobart Infrastructure & Civil Engineering
There has been an uplift of over 40% in divisional turnover to
external customers in this Division and the important terminal
extension at LSA was successfully completed on time and on budget.
This business remains key to our ability to drive up the value of
our investments by using our internal capacity to improve and build
assets. We will continue to grow our portfolio of external work,
principally in the rail infrastructure sector.
Transport & Distribution
T&D had a consistent year, with revenues from most business
units in line with budget. New business was secured and, in part
through funding awarded by government, we are working to deliver
fuel and carbon reductions. With William Stobart at the helm,
alongside the DBAY team, the new business of Eddie Stobart
Logistics Ltd is in a great position to deliver future growth.
The Stobart Brand
Our recognition of the importance and value of the Stobart
brand, alongside the inherent values, underpinned our decision to
retain ownership of this as part of the transaction to dispose of
51% of Transport & Distribution. The Stobart brand remains an
important asset to the Group, but through the brand licence with
Eddie Stobart Logistics Ltd, of which we remain a 49% shareholder,
this business is still able to draw on its iconic status with
customers by continuing to operate under the same livery and
name.
Stobart Group's positive brand image also plays an extremely
important role in building employee engagement and loyalty. Our
team is happy and proud to be 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.
Our Stobart Group and Eddie Stobart brands have been officially
recognised as 'Business Superbrands', and in 2014 Eddie Stobart was
nominated as the leading brand in the 'Supply Chain, Distribution
and Freight Services' category. An accredited Superbrand is
considered to have established the best reputation in its market,
providing its customers with both tangible and intangible
advantages over its competitors. Eddie Stobart has gained this
premium status because it has the highest reputation for quality,
service, performance and sustainability; clearly marking it out
from the competition for this prestigious award. These values of
quality, service, performance and sustainability are those inherent
in our brands and bear a direct relationship to their value.
Outlook
Looking back over 2013-14, we have made significant steps to
deliver value to our shareholders. Our strategy is now well set as
an infrastructure and support services Group. With capital to
invest and our executive team focused on our growth businesses in
Energy and Aviation, we are well placed to deliver good returns for
our shareholders over the next three years and into the future.
Andrew Tinkler
Operational & Financial Review
Results Summary
This year's financial results look quite different compared with
last year's, with the results of a substantial proportion of
Transport & Distribution Division being included in
discontinued operations in the current year and the prior year
figures restated accordingly. The partial disposal was a
significant realisation for the Group, but at the same time
management was not distracted from the continuing business and
underlying profitability has held strong.
Group revenue from continuing operations increased to GBP99.2m,
from GBP76.8m in the previous year. Underlying EBITDA increased to
GBP22.6m from GBP21.3m and underlying operating profit was GBP16.9m
compared with GBP16.3m in 2013. Finance costs (net) increased to
GBP11.5m from GBP10.0m as the amount of capitalised interest
reduced by GBP1.0m and the average net debt was slightly higher
across the year. The recorded loss before tax from continuing
operations was GBP10.2m (2013: profit GBP3.0m) following a charge
of GBP13.0m for impairment of assets.
As we move forward we expect EBITDA to be a key financial
measure to our new Divisions. The divisional EBITDA figures (see
table below) show progress in the Divisions but there is more work
to do to drive further profitability from our assets and our
brands. There was another strong performance in our Estates
Division with several realisations at profitable values which
enabled the Group to reduce net debt significantly.
The prior year figures have been restated to classify the
disposed Transport & Distribution business as discontinued. The
Environmental Transport business, which comprises the fleet of
chipliner and walking floor vehicles, is retained and is included
in the Transport & Distribution result in the table below. This
business provides transport services for our Biomass fuel supply
business as well as third party customers. In addition there has
been a minor restatement in the accounting for the defined benefit
pension scheme as required by the revised accounting standard IAS
19.
Partial disposal of the Transport & Distribution
Division
After the year end, on 10 April 2014, the Group disposed of a
controlling interest in the Transport & Distribution business
for gross consideration of GBP239.7m. This was a mature business
comprising the Eddie Stobart branded transport and logistics
operations, the Stobart Automotive operations and the Widnes rail
freight terminal operation. The transaction leaves the Group with a
remaining 49% interest in this business, which we expect to account
for as an associate in future periods. The results of this disposed
business are classified in discontinued operations in the
Consolidated Income Statement. Revenue for the business was
GBP559.7m (2013: GBP495.6m) and underlying profit before tax was
GBP25.3m (2013: GBP25.9m).
The assets and liabilities in relation to this business at the
year end are classified in the Consolidated Statement of Financial
Position as 'held for sale'. The net assets of the business at the
year end were GBP193.5m including GBP165.7m of goodwill.
Impairment of Assets
As a result of the partial disposal of the Transport &
Distribution business, certain assets will be recategorised from
property, plant and equipment to investment properties and other
assets are included in different Cash Generating Units (CGUs) for
impairment testing purposes. This has resulted in an impairment
charge of GBP13.0m being recorded in arriving at loss before tax
from continuing operations. The impairment of GBP4.8m in respect of
the Ports Operation assets has been caused partly by the expected
changes in activities at the sites following the classification as
held for sale of a substantial part of the Transport &
Distribution Division, and partly due to the delayed timing of
development at the Widnes site. The impairment in respect of
Carlisle Lake District Airport of GBP4.3m amounted to a significant
proportion of the planning and interest costs which have been
capitalised to date. There have also been impairments of two other
property assets which, at the year end, were mostly occupied by the
Transport & Distribution Division, but following the partial
disposal of that Division, will be classified as investment
properties and will be carried at fair value.
Business Segments
The business segments reported in the financial statements for
the year are the same segments as reported in 2012-13 as this
reflects the way in which the Group was managed during the year.
Going forward for the current year to 28 February 2015 we expect to
report under revised segments which better represent the
operational and reporting structure of the business following the
part realisation of the Transport & Distribution business. The
Group is now positioned in Infrastructure and Support Services with
income derived from Infrastructure, Energy, Aviation, Rail and
Investments. We expect that EBITDA will continue to be a key
financial performance measure.
Earnings Per Share
Basic earnings per share from continuing and discontinued
operations were 3.3p (2013: 5.1p).
Taxation
The tax credit on continuing and discontinued activities of
GBP0.5m (2013: GBP0.8m charge) is at an effective rate of -4.8%
(2013: 4.4%). The effective rate has been reduced by GBP3.1m owing
to the impact of the change in corporation tax rate on deferred tax
balances and by GBP1.3m owing to profits on property disposals
which were not taxable but offset by non tax-deductible
amounts.
Statement of Financial Position
We have a strong balance sheet with net assets of GBP461.1m
(2013: GBP462.1m). The net asset position was improved by GBP8.6m
through the sale of treasury shares during the year but adversely
affected by the charge for impairment of assets.
Non-Current Assets
Property, plant and equipment of GBP246.6m (2013: GBP312.2m)
principally comprise the land and buildings at London Southend
Airport, Carlisle Airport and the development sites at Widnes
Multimodal Gateway and Runcorn Port of Weston, the latter two of
which are partly rented to the Transport & Distribution
business. The Group has retained three other freehold properties
used by the disposed Transport & Distribution business which
will be reclassified as investment properties after the
disposal.
Investments in associates and joint ventures of GBP15.8m (2013:
16.1m) comprise the equity investments in a company which leases
aircraft to Stobart Air, and also a green energy development. There
were also balances owed by associates and joint ventures of GBP5.1m
(2013: GBP4.9m) which at the year end represented balances due from
green energy investments.
Intangible assets of GBP120.2m (2013: GBP286.2m) comprise the
brands and remaining goodwill after a considerable proportion of
the goodwill in relation to the Transport & Distribution
Division has been included in assets held for sale. Following the
disposal the Group has retained ownership of all of the Stobart
brand names, trademarks and designs and the Eddie Stobart brands
are licensed to the disposed business under a licence agreement.
The remaining goodwill principally relates to the Biomass
business.
Current Assets
Current assets (excluding assets of disposal groups held for
sale) of GBP102.6m (2013: GBP166.9m) includes GBP10.7m of cash and
GBP68.1m of restricted cash. After the year end this restricted
cash was used to substantially repay the property loan held with GE
Real Estate Finance Ltd.
Disposal Groups
Assets of disposal groups held for sale of GBP342.5m comprise
GBP328.4m in respect of the disposed Transport & Distribution
business and GBP14.1m in respect of five properties which are being
marketed for sale. Liabilities of disposal groups held for sale of
GBP134.9m comprise the liabilities of the disposed Transport &
Distribution business.
Funding
The net debt of the Group at year end has decreased to GBP127.9m
(2013: GBP216.4m) plus GBP19.8m which is included in the disposal
group. The reduction in the year is principally due to the
realisation of proceeds from the disposal of six properties during
the year for proceeds of GBP73.5m.
Following the year end, the GBP100m development loan with
M&G Investment Management has been fully repaid from proceeds
of the Transport & Distribution transaction, and GBP68.1m of
the GE property loan has been repaid out of restricted cash. After
the part disposal the Group has a net cash position with over
GBP35m of borrowing facilities available.
The gearing ratio based on a percentage of net debt to net
assets at year-end is 27.7% (2013: 46.8%). The operating lease
commitments have reduced to GBP41.6m from GBP295.2m following the
disposal of the Transport & Distribution business.
Cashflow
Cash generated from continuing operations was GBP7.8m (2013:
GBP8.7m). Operating cash inflow from discontinued operations was
GBP26.1m (2013: GBP23.9m).
Cash outflow for capital expenditure in the year totalled
GBP17.0m (2013: GBP31.2m). This includes development expenditure at
London Southend Airport of GBP14.1m mainly for the new terminal
extension. Other capital expenditure includes GBP2.2m for
development of the investment property portfolio.
Cash received from the disposal of property, plant and equipment
and investment property was GBP71.0m (2013: GBP11.0m). This
includes GBP64.3m in respect of disposals of investment property
assets.
Finance costs paid in cash (net) totalled GBP13.7m (2013:
GBP10.8m) and was higher than expected as the negotiations with GE
to repay the property loan took longer than expected.
Dividends paid in cash totalled GBP20.5m (2013: GBP20.9m), the
reduction due to the partial uptake of a scrip option for the final
dividend but with the same annual dividend rate of 6p (2013:
6p).
Dividends
Dividends are expected to be maintained at the current level in
the foreseeable future and, in the short term, partly funded out of
proceeds from disposals of property assets. The Board proposes a
final dividend of 4.0p (2013: 4.0p) bringing the total dividend for
the year to 6.0p (2013: 6.0p). Subject to the approval of
shareholders the final dividend will be payable to investors on
record on 30 May 2014 with an ex-dividend date of 28 May 2014 and
will be paid on 4 July 2014.
Ben Whawell
Consolidated Income Statement
For the year to 28 February 2014
Restated
2014 2013
GBP'000 GBP'000
-------------------------------------- ---------- -----------------
Continuing operations
Revenue 99,179 76,787
Operating expenses - underlying (92,048) (66,222)
Share of post tax profits
of associates and joint ventures 460 871
Gain in value of investment
properties 4,223 5,173
Profit on disposal of investment
properties 6,427 -
(Loss)/profit on disposal
of assets held for sale (100) 495
Write-down in value of assets
held for sale (920) -
Share based payments (369) (808)
-------------------------------------- ---------- -----------------
Underlying operating profit 16,852 16,296
New territory and new business
set up costs - (1,020)
Transaction costs (480) (1,856)
Restructuring costs (1,905) (232)
Impairment of property, plant
and equipment (12,970) -
Amortisation of acquired intangibles (221) (221)
-------------------------------------- ---------- -----------------
Profit before interest and
tax 1,276 12,967
Finance costs (12,098) (10,049)
Finance income 635 76
-------------------------------------- ---------- -----------------
(Loss) / profit before tax (10,187) 2,994
Tax (393) 376
-------------------------------------- ---------- -----------------
(Loss) / profit from continuing
operations (10,580) 3,370
-------------------------------------- ---------- -----------------
Discontinued operation
Profit from discontinued operation,
net of tax 21,929 13,986
-------------------------------------- ---------- -----------------
Profit for the year 11,349 17,356
-------------------------------------- ---------- -----------------
Profit attributable to:
Owners of the company 11,339 17,353
Non-controlling interests 10 3
-------------------------------------- ---------- -----------------
Profit for the year 11,349 17,356
-------------------------------------- ---------- -----------------
Earnings per share - continuing
operations
Basic (3.06)p 0.98p
Diluted (3.06)p 0.98p
---------------------------------- ------- -----
Earnings per share
Basic 3.29p 5.06p
Diluted 3.28p 5.04p
---------------------------------- ------- -----
For an explanation of the restatement of the 2013 results,
please see notes.
Consolidated Statement of Comprehensive Income
For the year to 28 February 2014
Restated
2014 2013
GBP'000 GBP'000
------------------------------------- -------- --------
Profit for the year 11,349 17,356
Exchange differences on translation
of foreign operations 578 (445)
Cash flow hedge 880 476
Revaluation of property, plant
and equipment (781) 781
Tax on items relating to components
of other comprehensive income (19) (350)
Discontinued operations, net
of tax, relating to exchange
differences (872) 1,004
------------------------------------- -------- --------
Other comprehensive (expense)/income
to be reclassified to profit
or loss in subsequent periods,
net of tax (214) 1,466
------------------------------------- -------- --------
Remeasurement on defined benefit
plan (409) 53
Tax on items relating to components
of other comprehensive income 82 (54)
Discontinued operations, net
of tax, relating to remeasurement
of defined benefit pension
plan (41) 752
------------------------------------- -------- --------
Other comprehensive (expense)/income
not being reclassified to profit
or loss in subsequent periods,
net of tax (368) 751
------------------------------------- -------- --------
Other comprehensive (expense)/income
for the period, net of tax (582) 2,217
------------------------------------- -------- --------
Total comprehensive income
for the year 10,767 19,573
------------------------------------- -------- --------
Total comprehensive income
attributable to:
Owners of the company 10,757 19,570
Non-controlling interests 10 3
------------------------------------- -------- --------
Total comprehensive income
for the year 10,767 19,573
------------------------------------- -------- --------
Consolidated Statement of Financial Position
As at 28 February 2014
Restated
2014 2013
GBP'000 GBP'000
---------------------------------------------- ---------- ----------
Non-current Assets
Property, plant and equipment
* Land and buildings 219,864 247,497
* Plant and machinery 22,362 32,118
* Fixtures, fittings and equipment 1,885 5,338
* Commercial vehicles 2,535 27,215
---------------------------------------------- ---------- ----------
246,646 312,168
Investment in associates and
joint ventures 15,799 16,086
Investment property 30,890 89,526
Intangible assets 120,173 286,214
Other investments - 7
Amounts owed by associates
and joint ventures 5,083 4,930
---------------------------------------------- ---------- ----------
418,591 708,931
Current Assets
Inventories 962 4,251
Corporation tax 148 1,338
Trade and other receivables 22,637 128,869
Restricted cash 68,130 12,755
Cash and cash equivalents 10,720 19,733
Assets of disposal groups
classified as held for sale 342,550 10,700
---------------------------------------------- ---------- ----------
445,147 177,646
---------------------------------------------- ---------- ----------
Total Assets 863,738 886,577
---------------------------------------------- ---------- ----------
Non-current Liabilities
Loans and borrowings (176,681) (215,707)
Defined benefit pension scheme (2,398) (4,794)
Other liabilities (11,578) (18,363)
Deferred tax (22,621) (26,905)
Provisions (2,985) (2,985)
---------------------------------------------- ---------- ----------
(216,263) (268,754)
Current Liabilities
Trade and other payables (21,123) (122,542)
Loans and borrowings (30,028) (33,194)
Provisions (250) -
Liabilities of disposal groups (134,936) -
classified as held for sale
---------------------------------------------- ---------- ----------
(186,337) (155,736)
---------------------------------------------- ---------- ----------
Total Liabilities (402,600) (424,490)
---------------------------------------------- ---------- ----------
Net Assets 461,138 462,087
---------------------------------------------- ---------- ----------
Consolidated Statement of Financial Position, Continued
As at 28 February 2014
2014 2013
GBP'000 GBP'000
----------------------------------- --------- ----------
Capital and reserves
Issued share capital 35,434 35,397
Share premium 301,326 300,788
Foreign currency exchange reserve (506) (212)
Reserve for own shares held
by employee benefit trust (408) (386)
Hedge reserve (327) (1,032)
Revaluation reserve - 781
Retained earnings 125,606 126,748
Group Shareholders' Equity 461,125 462,084
Non-controlling interest 13 3
----------------------------------- --------- ----------
Total Equity 461,138 462,087
----------------------------------- --------- ----------
Consolidated Statement of Changes in Equity
For the year to 28 February 2014
Reserve
for
Foreign Own
Issued Currency Shares
Share Share Exchange held Hedge Revaluation 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 2013 35,397 300,788 (212) (386) (1,032) 781 126,748 462,084 3 462,087
Profit for the
year - - - - - - 11,339 11,339 10 11,349
Other
comprehensive
income /
(expense)
for the year - - (294) - 705 (781) (212) (582) - (582)
------------------ -------- -------- --------- -------- -------- ------------ --------- --------- ---------------- ---------
Total
comprehensive
income/(expense)
for the year - - (294) - 705 (781) 11,127 10,757 10 10,767
Proceeds on share
issues 37 277 - (22) - - - 292 - 292
Share-based
payment
credit - - - - - - 434 434 - 434
Tax on
share-based
payment - - - - - - (108) (108) - (108)
Sale of treasury
shares - 261 - - - - 8,560 8,821 - 8,821
Dividends paid
to minority
interest - - - - - - (312) (312) - (312)
Dividends - - - - - - (20,843) (20,843) - (20,843)
------------------ -------- -------- --------- -------- -------- ------------ --------- --------- ---------------- ---------
Balance at
28 February 2014 35,434 301,326 (506) (408) (327) - 125,606 461,125 13 461,138
------------------ -------- -------- --------- -------- -------- ------------ --------- --------- ---------------- ---------
Consolidated Statement of Changes in Equity
For the year to 28 February 2013 (Restated)
Reserve
for
Foreign Own
Issued Currency Shares
Share Share Exchange held Hedge Revaluation 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 35,397 300,788 (771) (488) (1,423) - 137,457 470,960 - 470,960
Profit for the
year - - - - - - 17,353 17,353 3 17,356
Other
comprehensive
income for
the
year - - 559 - 391 781 486 2,217 - 2,217
--------------- -------- -------- --------- -------- -------- ------------ --------- --------- ---------------- ---------
Total
comprehensive
income 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
--------------- -------- -------- --------- -------- -------- ------------ --------- --------- ---------------- ---------
Consolidated Cash Flow Statement
For the year to 28 February 2014
Restated
2014 2013
GBP'000 GBP'000
------------------------------------- --------- ---------
Cash generated from continuing
operations 7,787 8,695
Cash inflow from discontinued
operations 26,074 23,927
Income taxes paid (1,668) (2,631)
------------------------------------- --------- ---------
Net cash flow from operating
activities 32,193 29,991
------------------------------------- --------- ---------
Transaction costs (80) -
Purchase of property, plant
and equipment and investment
property (17,009) (31,164)
Proceeds from the sale of property,
plant and equipment and investment
property 17,237 105
Proceeds from disposal of assets
held for sale 1,925 10,225
VAT outflow in relation to
disposal of property - (4,583)
Equity investment in joint
ventures (8,846) (2,147)
Net loans repaid by/( advanced
to) associates and joint ventures 2,362 (4,891)
Interest received 511 75
Cash inflow / (outflow) from
discontinued operations 12,018 (6,314)
------------------------------------- --------- ---------
Net cash flow from investing
activities 8,118 (38,694)
------------------------------------- --------- ---------
Issue costs paid on ordinary
shares (21) -
Dividend paid on ordinary shares (20,509) (20,851)
Proceeds from new finance leases - 4,923
Repayment of capital element
of finance leases (2,183) (1,903)
Proceeds from new borrowings 14,965 38,625
Repayment of borrowings (13,419) (16,034)
Sale / (purchase) of treasury
shares, net of costs 8,821 (9,519)
Proceeds from grant 2,766 3,000
Interest paid (13,421) (10,827)
Other finance and transaction
costs (400) -
Net cash transferred to restricted
cash (894) (349)
Cash outflow from discontinued
operations (6,688) (4,605)
------------------------------------- --------- ---------
Net cash flow from financing
activities (30,983) (17,540)
------------------------------------- --------- ---------
Consolidated Cash Flow Statement, Continued
For the year to 28 February 2014
Restated
2014 2013
GBP'000 GBP'000
------------------------------------------ --------- ---------
Increase / (decrease) in cash
and cash equivalents 9,328 (26,243)
Cash and cash equivalents at
beginning of year 158 26,401
------------------------------------------ --------- ---------
Cash and cash equivalents at
end of year 9,486 158
------------------------------------------ --------- ---------
Restricted cash movements
Cash and cash equivalents at
beginning of year 12,755 -
Proceeds from the sale of property,
plant and equipment and investment
property 54,357 10,904
Proceeds from disposal of assets
held for sale - 1,502
Interest received 124 -
Net cash transferred from unrestricted
cash 894 349
------------------------------------------ --------- ---------
Increase in cash and cash equivalents 55,375 12,755
------------------------------------------ --------- ---------
Restricted cash at end of year 68,130 12,755
------------------------------------------ --------- ---------
Total cash and cash equivalents
at end of year, including Restricted
cash 77,616 12,913
------------------------------------------ --------- ---------
Cash (includes Restricted cash
of GBP68,130,000 (2013: GBP12,755,000))
- Continuing 78,850 32,488
Cash - Reclassified as held
for sale 11,797 -
Overdraft - Continuing (4,522) (19,575)
Overdraft - Reclassified as
held for sale (8,509) -
------------------------------------------ --------- ---------
Cash and cash equivalents at
end of year, including Restricted
cash 77,616 12,913
------------------------------------------ --------- ---------
Notes to the Consolidated Financial Statements
For the year to 28 February 2014
Accounting Policies of Stobart Group Limited
Basis of preparation and statement of compliance
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 2014 and year
ended 28 February 2013 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.
Going Concern
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.
Following the partial disposal of a significant proportion of
the Transport & Distribution business, a significant amount of
the Group's loans and borrowings were repaid.
The Group has considerable financial resources, together with
contracts with a number of customers and suppliers. The financial
forecasts show that the Group's remaining 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. The Group actively manages its short and
long term funding requirement through various forecasting
procedures.
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 28 February 2013 Financial Information
The results for the year ended 28 February 2013, of the part of
the Transport & Distribution business which was disposed of
post year end, have been restated as discontinued operations and
the related assets and liabilities are reclassified as held for
sale. This is required by IFRS to be consistent with the treatment
in the current year. See note 4 for further details.
A restricted cash balance of GBP68,130,000 (2013: GBP12,755,000)
has been reclassified to show it separately on the face of the
Consolidated Statement of Financial Position, and the Consolidated
Cash Flow Statement has been restated accordingly. This change has
made no difference to the net assets or net debt at either year
end.
With effect from 1st March 2013, the Group was required to take
account of the revised accounting standard, IAS 19 - 'Employee
Benefits'. This change impacts the Group by amending disclosure
requirements and replacing the expected return on plan assets and
interest cost on plan obligations with net interest on the net
defined benefit liability based upon the discount rate. The
specific lines affected by this restatement in the Consolidated
Income Statement for the year ended 28 February 2013 are finance
costs, which increased by GBP113,000, finance income, which
decreased by GBP103,000, and the tax charge which decreased by
GBP50,000. The effect of the restatement on the Consolidated
Statement of Financial Position is not deemed to be material and as
such the presentation of a third balance sheet as indicated by IAS
1 is not considered necessary.
Certain liabilities which were previously classified as 'other
liabilities' have been classified as 'provisions' to better reflect
the uncertain nature of these liabilities. This has had the impact
of reducing other liabilities at 28 February 2013 by GBP2,985,000
and increasing provisions by the same amount, with no change to net
assets. See Note 25 for further details.
Separately Disclosed Items
The Group presents separately on the face of the income
statement material items of income and expense, which because of
their nature, infrequency or occurrence, or the events giving rise
to them, merit separate presentation to allow shareholders to
better understand the financial performance of the year. Underlying
operating profit is stated before separately disclosed items and
share based payments.
Segmental information
The operating segments reported during the year within
continuing operations are Stobart Transport & Distribution,
Stobart Estates, Stobart Infrastructure & Civil Engineering,
Stobart Air and Stobart Biomass.
During the year the Stobart Transport & Distribution segment
specialised in contract logistics. A substantial proportion of the
Transport & Distribution division has been included in
discontinued operations in the current year, following the disposal
post year end of the Group's controlling interest of part of this
business. The remaining continuing Transport & Distribution
segment comprises principally the Environmental Transport
operation, which has been retained post disposal of the rest of the
Transport & Distribution operation.
The Stobart Estates segment specialises in the management,
development and realisation of land and buildings assets for owner
occupied and third party tenanted properties
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 the operation of
commercial airports.
The Stobart Biomass segment specialises in the 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 each
business unit 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
2014 & 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 25,839 6,014 15,579 20,342 28,104 3,301 99,179
Internal 5,281 1,622 13,208 - - (20,111) -
------------------ -------------- --------- ---------------- -------- --------- ------------------ ---------
Total revenue 31,120 7,636 28,787 20,342 28,104 (16,810) 99,179
------------------ -------------- --------- ---------------- -------- --------- ------------------ ---------
Depreciation (372) (2,623) (1,394) (743) (294) (343) (5,769)
Net finance
costs (59) (8,843) (212) (306) (44) (1,999) (11,463)
Share of profit
of associates
and joint
ventures - 1,127 - - - (667) 460
Gain in value
of investment
properties - 4,223 - - - - 4,223
Profit on
disposal of
investment
properties - 6,427 - - - - 6,427
Loss on disposal
of and write
downs in assets
held for sale - (1,020) - - - - (1,020)
Share based
payments - - - - - (369) (369)
------------------ -------------- --------- ---------------- -------- --------- ------------------ ---------
Segment EBITDA 3,714 17,695 3,490 71 4,450 (6,799) 22,621
------------------ -------------- --------- ---------------- -------- --------- ------------------ ---------
Segment PBT 3,283 6,229 1,884 (978) 4,112 (9,141) 5,389
------------------ -------------- --------- ---------------- -------- --------- ------------------ ---------
Transaction
costs written
off (480)
Restructuring
costs (1,905)
Impairment
of property,
plant and
equipment (12,970)
Amortisation
of acquired
intangibles (221)
------------------ -------------- --------- ---------------- -------- --------- ------------------ ---------
Loss on continuing operations before tax (10,187)
------------------------------------------------------------------------------------ ------------------ ---------
Period ended Stobart Stobart
28 February Transport Infrastructure
2013 & 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 18,101 14,845 11,062 14,938 16,402 1,439 76,787
Internal 2,753 1,234 19,800 - - (23,787) -
------------------- -------------- --------- ---------------- -------- --------- ------------------ ----------
Total revenue 20,854 16,079 30,862 14,938 16,402 (22,348) 76,787
------------------- -------------- --------- ---------------- -------- --------- ------------------ ----------
Depreciation (249) (1,448) (1,469) (921) (109) (824) (5,020)
Net finance
costs (28) (9,112) (250) (193) (70) (320) (9,973)
Share of profit
of associates
and joint
ventures - 1,312 - - - (441) 871
Gain in value
of investment
properties - 5,173 - - - - 5,173
Profit on
disposal of
assets held
for sale - 495 - - - - 495
Share based
payments - - - - - (808) (808)
------------------- -------------- --------- ---------------- -------- --------- ------------------ ----------
Segment EBITDA 3,032 16,962 4,876 441 4,132 (8,127) 21,316
------------------- -------------- --------- ---------------- -------- --------- ------------------ ----------
Segment PBT 2,755 6,402 3,157 (673) 3,953 (9,271) 6,323
------------------- -------------- --------- ---------------- -------- --------- ------------------ ----------
New territory
and new business
set-up costs (1,020)
Transaction
costs written
off (1,856)
Restructuring
costs (232)
Amortisation
of acquired
Intangibles (221)
------------------- -------------- --------- ---------------- -------- --------- ------------------ ----------
Profit on continuing operations
before tax 2,994
---------------------------------------------------------------- -------- --------- ------------------ ----------
No segmental assets or liabilities information is disclosed
because no such information is regularly provided to, or reviewed
by, the Chief Operating Decision Maker.
Inter-segment revenues are eliminated on consolidation.
Included in adjustments and eliminations are central costs of
GBP8,599,000 (2013: GBP7,514,000) and intra-group profit of
GBP542,000 (2013: GBP1,758,000).
Discontinued Operations
The group disposed of a controlling interest in a substantial
proportion of the Transport & Distribution division on 10 April
2014. The group has retained a 49% interest in the business, which
is expected to be accounted for as an associate in future periods.
The Environmental Transport business unit, which was previously
part of the Transport & Distribution division, was also
retained.
The chilled pallet network business unit, which was closed in
the prior year, and reported as a discontinued operation in that
year, previously formed part of the Transport & Distribution
business. These businesses have been reported separately as a
single amount presented within discontinued operations. The
operations both represented separate major lines of business.
Restated
2014 2013
Results of discontinued operations GBP'000 GBP'000
-------------------------------------- --------- ---------
Revenue 559,661 540,644
Operating expenses - underlying (533,307) (530,337)
Share based payments (65) (520)
Profit on disposal of business - 8,511
Transaction costs (391) (903)
Restructuring costs (3,221) (561)
Amortisation of acquired intangibles (76) (160)
Net finance costs (1,586) (1,510)
-------------------------------------- --------- ---------
Profit before tax 21,015 15,164
-------------------------------------- --------- ---------
Tax 914 (1,178)
-------------------------------------- --------- ---------
Profit for the year from discontinued
operations, net of tax 21,929 13,986
-------------------------------------- --------- ---------
Basic earnings per share 6.35p 4.08p
-------------------------------------- --------- ---------
Diluted earnings per share 6.34p 4.06p
-------------------------------------- --------- ---------
Restated
Cash flows used in discontinued 2014 2013
operations GBP'000 GBP'000
----------------------------------- -------- --------
Net cash from operating activities 26,074 23,927
Net cash from/(used in) investing
activities 12,018 (6,314)
Net cash used in financing
activities (6,688) (4,605)
----------------------------------- -------- --------
Net cash flows for the year 31,404 13,008
----------------------------------- -------- --------
The profit from discontinued operations of GBP21,929,000 (2013:
GBP13,986,000) is attributable to the owners of the Company, with
the exception of GBP10,000 (2013: GBP3,000) that is attributable to
the minority interest. There was no loss recorded on remeasurement
to fair value less costs to sell.
Dividends
2014 2014 2013 2013
Dividends paid on Ordinary
Shares Rate Rate
p GBP'000 p GBP'000
---------------------------- ----- -------- ----- --------
Final dividend for 2013
paid 5 July 2013 4.0 13,891 - -
Interim dividend paid
6 December 2013 2.0 6,952 - -
Final dividend for 2012
paid 6 July 2012 - - 4.0 13,921
Interim dividend paid
7 December 2012 - - 2.0 6,930
---------------------------- ----- -------- ----- --------
Dividends paid 6.0 20,843 6.0 20,851
---------------------------- ----- -------- ----- --------
A final dividend of 4.0p per share was declared on 21 May 2014
and subject to approval of shareholders will be paid on 4 July
2014. This is not recognised as a liability as at 28 February
2014.
Of the GBP13,891,000 dividend in July 2013, GBP334,000 was
settled by the issue of shares under a scrip offer.
Financial assets and liabilities
Loans and borrowings 2014 2013
GBP'000 GBP'000
----------------------------------------------------------- --------- ---------
Non-current
Fixed rate
* Obligations under finance leases and hire purchase
contracts 10,009 27,181
* Loan notes - 3,745
* Bank loans 69,828 68,659
Variable rate
* Obligations under finance leases and hire purchase
contracts - 379
* Bank loans 96,844 115,743
176,681 215,707
----------------------------------------------------------- --------- ---------
Current
Fixed rate
* Obligations under finance leases and hire purchase
contracts 2,652 10,353
* Bank loans - 1,400
2,820 -
* Loan notes
Variable rate
* Obligations under finance leases and hire purchase
contracts - 1,120
* Overdrafts 4,522 3,157
* Invoice Discounting Facility - 16,418
* Bank loans 20,034 746
----------------------------------------------------------- --------- ---------
30,028 33,194
----------------------------------------------------------- --------- ---------
Total loans and borrowings 206,709 248,901
----------------------------------------------------------- --------- ---------
Cash 10,720 19,733
Restricted cash 68,130 12,755
----------------------------------------------------------- --------- ---------
Net debt 127,859 216,413
----------------------------------------------------------- --------- ---------
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 GBP100,000,000 variable
rate group finance arrangement. The terms of this loan were amended
in May 2013 such that it would be repayable in GBP5,000,000
quarterly instalments as from 31 May 2014. This loan was fully
repaid on 11 April 2014. Also included in bank loans is a
GBP74,864,000 (2013: GBP77,286,000) property loan. The property
loan was originally due for repayment in quarterly installments
ending April 2017. This loan had fixed and variable elements of
GBP69,828,000 (2013: GBP72,328,000) and GBP5,036,000 (2013:
GBP4,958,000) respectively at 28 February 2014. The bank loans also
include GBP15,000,000 drawn on a GBP20,000,000 variable rate
committed revolving credit facility with a facility end date of
February 2016.
Included in cash is GBP68,130,000 (2013: GBP12,755,000) of
'Restricted cash' which is held in an asset proceeds account and at
28 February 2014 its use was restricted to reinvestment in new
property assets or repayment of the property loan. This Restricted
cash was used to repay a substantial proportion of the
GBP74,864,000 property loan on 3 March 2014.
The loan notes were issued in connection with the acquisition of
Stobart Biomass Products Limited on 19 May 2011. These loan notes
were fully repaid on 5 March 2014.
The Group was in compliance with financial covenants throughout
the year and the previous year.
Notes to the consolidated cash flow statement
Cash generated from continuing Restated
operations 2014 2013
GBP'000 GBP'000
----------------------------------- -------- --------
(Loss)/profit before tax from
continuing operations (10,187) 2,994
Adjustments to reconcile (loss)
/ profit before tax to net
cash flows
Non-cash:
Gain in value of investment
properties (4,223) (5,173)
Realised profit on sale of
property, plant and equipment
and investment properties (7,397) 175
Share of post tax profits of
associates & joint ventures
accounted for using the equity
method (460) (871)
Loss / (profit) on disposal
of/write-down in value of assets
held for sale 1,020 (495)
Depreciation of property, plant
and equipment 5,769 5,020
Impairment of assets 12,970 -
Finance income (635) (76)
Interest expense 12,098 10,049
Release of grant income (240) (199)
Non-operating transaction costs 480 1,856
Amortisation of intangible
assets 221 221
Share option charge 369 808
Working capital adjustments:
Decrease/(increase) in inventories 529 (1,152)
Decrease/(increase) in trade
and other receivables 3,906 (6,843)
(Decrease)/increase in trade
and other payables (6,433) 2,381
Cash generated from continuing
operations 7,787 8,695
----------------------------------- -------- --------
Related Parties
Relationships of Common Control or Significant Influence
WA Developments International Limited is owned by WA Tinkler.
During the year, the Group paid rent of GBP20,000 (2013: GBP78,000)
and levied recharges of GBP119,000 relating to the recovery of
staff costs and expenses (2013: GBP537,000) to WA Developments
International Limited. GBP48,000 (2013: GBP990,000) was due from
and GBP11,000 (2013: GBP340,000) was due to WA Developments
International Limited at the year end.
In addition, the group received rent of GBPnil (2013:
GBP281,100) from WA Developments International Limited under a rent
guarantee arrangement. This guarantee was a term of the acquisition
by the Group of WADI Properties Limited from WA Developments
International Limited on 28 February 2012 and expired on 28
February 2013.
Apollo Air Services Limited is owned by WA Tinkler. During the
year, the Group made purchases of GBP407,000 (2013: GBPnil) from
Apollo Air Services Limited relating to the provision of passenger
transport. GBP29,000 (2013: GBPnil) was owed by the Group to this
company at the year end.
VLL Limited is owned by WA Tinkler. During the year, the Group
made sales of GBP20,000 (2013: GBP17,000) relating to fuel and made
purchases of GBP434,000 (2013: GBP826,000) relating to the
provision of passenger transport. GBPnil (2013: GBP193,000) was
owed to the Group at the year end and GBPnil (2013: GBP100,000) was
owed by the Group at the year end.
During the year the Group made purchases of GBP254,000 (2013:
GBP550,000), relating to the provision of branded products and
vehicle advertising, from Ast Signs Limited, a company in which W
Stobart holds a 27% shareholding. A balance of GBP40,000 (2013:
GBP61,000) 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 (2013: GBP2,132,000) at the year
end.
The Group had loans outstanding from its joint venture interest,
Westbury Fitness Hull Limited of GBP471,000 (2013: GBP471,000) at
the year end, of which GBP471,000 (2013: GBP471,000) has been
provided for.
The Group had loans outstanding from companies within the group
headed by its joint venture interest, Everdeal Holdings Limited, of
GBP782,000 (2013: GBP3,031,000) at the year end. During the year,
the Group made sales of GBP615,000 (2013: GBP1,692,000) to a 100%
subsidiary of Everdeal Holdings Limited. A balance of GBP202,000
(2013: GBP262,000) was owed to the Group at the year end. The
interest receivable during the year was GBP174,000 (2013:
GBP494,000).
The Group had loans outstanding from its associate interest,
Shuban Power Limited, of GBP4,281,000 (2013: GBP1,570,000) at the
year end. The interest receivable during the year was GBP264,000
(2013: GBPnil).
The Group had loans outstanding from its associate interest,
Shuban 6 Limited, of GBP802,000 (2013: GBPnil) at the year end. The
interest receivable during the year was GBP28,000 (2013:
GBPnil).
The Group had loans outstanding from its joint venture interest,
Stobart Barristers Limited of GBP567,000 (2013: GBP306,000) at the
year end of which GBP500,000 (2013: GBPnil) has been provided for.
During the year, the Group made purchases of GBP88,000 (2013:
GBP80,000) from Stobart Barristers Limited of which GBP9,000 (2013:
GBP54,000) was owed at the year end.
The Group made sales of GBP3,155,000 (2013: GBP1,684,000) and
purchases of GBPnil (2013: GBP2,000) to its joint venture interest,
Vehicle Logistics Corporation BV of which GBP136,000 (2013:
GBP368,000) was owed to the Group at the year end. All balances
outstanding at 28 February 2014 were included within the disposal
group classified as held for sale.
Post Balance Sheet Events
On 10 April 2014 the Group completed the disposal of a
controlling interest in a substantial proportion of the Transport
& Distribution division, to funds managed by DBAY Advisors, for
proceeds of around GBP195,600,000 before transaction costs. The
Environmental Transport business unit has been retained. The Group
retains an economic interest of 49% in the business, which is
expected to be accounted for as an associate in future periods. The
Group has retained the ownership of the Eddie Stobart brand and the
business will continue to use these brands under a licence
agreement. The Group has also retained a number of freehold
properties which have been leased to the business on an arms-length
basis.
Following the disposal, on 11 April 2014, the GBP100,000,000
variable rate loan with M&G Investment Management Limited was
fully repaid and the facility terminated.
On 3 March 2014, GBP68,130,000 of the Restricted Cash held at 28
February 2014 was used to repay a substantial proportion of the
property loan with GE Real Estate Finance Limited, plus payment of
fees. At the same time the terms of the remaining debt were
renegotiated and the facility was reduced commensurately.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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