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Stobart Share Discussion Threads
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|Market seems to like Mark Adams :-)
Appointment of Chief Financial Officer
Stobart Group is pleased to announce the appointment of Mark Adams as Chief Financial Officer ("CFO") with effect from 28 November 2016.
Mark brings to Stobart Group more than 20 years of experience in senior finance roles in a broad range of sectors. Most recently Mark has held roles at Pets at Home Group Plc and Cognita Schools, in both cases acting as Interim CFO. Prior to these roles he was CFO at Hastings Insurance Group, easyJet Plc, Helphire Group Plc, Alpha Airports Group Plc, STA Travel Group and Prism Rail Plc.|
|Woodford Investment Management adding again, 15% now|
|Has anyone been a long term holder here ? Would you like to meet the management ? Any thoughts or comments on Southend Airport ?|
Flexible financing: how Stobart matched the right type of debt to their assets
rocessing old timber and carting it around the country to keep power stations burning is a job for heavy machinery – demanding equally hefty investment. Stobart Group Ltd is one of the businesses leading the charge in ensuring that waste wood doesn’t literally go to waste.
While clean wood can be recycled, a great deal of timber, such as old kitchens and other wood contaminated with paint or chemicals can’t, meaning it usually ends up as junk in landfill. But thanks to converted power stations running on timber rather than coal (which the government plans to phase out by 2025), the demand for biomass fuel such as waste wood is on the rise. For the companies transporting this bulky stuff around the country, that translates into an urgent need for more trucks.
Infrastructure, transport and services specialist Stobart Group Ltd is one of the UK’s leading suppliers of biomass, and has invested tens of millions of pounds in specialist tractors, trailers and industrial machinery to be able to process and deliver biomass to feed the new- generation boilers.
If the market is good we can sell at any point, but we also have a buy-back arrangement
Ben Whawell, chief financial officer, Gtobart group ltd
Once known for the famous green lorries on Britain’s roads, Stobart sold off a controlling stake in the trucking arm of the business in 2014 and has branched out into biomass fuel and aviation. It operates Southend airport, which it bought in 2008.
“The biomass supply chain was a natural fit for us alongside transport,” says Ben Whawell, the company’s chief financial officer. “We currently supply a million tonnes of biomass,” he says. This, he hopes, will rise to 2.5 million tonnes by 2018.
Some of this will go to one of the UK’s largest waste wood renewable energy plants in Widnes on Merseyside. By December 2016, the plant is expected to supply renewable electricity to more than 35,000 homes each year – and cut greenhouse gas emissions by 1.3 million tonnes. To do this it will need to burn some 146,000 tonnes of recovered wood a year, sourced by Stobart under a long-term fuel supply contract.
Eventually, the group will supply more than 15 plants across the UK and Northern Ireland, all of which should be operational by the end of 2017. In 2014, Stobart took the decision to build up its fleet and buy, rather than lease the specialist trucks and trailers.
“We wanted to expand,” says Mr Whawell. “While owning rather than leasing them adds more debt to the balance sheet, we felt our shareholders would understand what we were doing.”
A former client of the Royal Bank of Scotland, Stobart turned to asset finance specialist Lombard, part of the banking group and a financial backer it had used before. “Asset finance was a natural fit for us,” says Mr Whawell. “We explained to Lombard we wanted flexibility, a good price and to work with somebody who understood the business.”
We explained to Lombard we wanted flexibility, a good price and to work with somebody who understood the business.
Ben Whawell, chief financial officer, stobart group ltd
The decision to avoid a lease agreement – which is common in fleet financing – was in part to avoid being tied to the restrictive terms and the expense of a lease. Stobart wanted to be more fleet of foot to take advantage of a changing market in second-hand trucks. Lombard created a flexible deal which allows Stobart to respond to fluctuating prices. “If the market is good, we can sell at any point, but also we have a buy-back arrangement with the manufacturers – so we are in a position to be able to make money from our second- hand trucks if the conditions are right,” says Mr Whawell.
As Stobart already had some vehicles on lease, Lombard worked with the company to refinance its entire fleet of trucks and trailers – which amounted to more than 500 assets, at a total cost of more than £20 million. “It was a real mixed bag of old and new,” says Andy Norman, Lombard’s relationship director for Stobart and a member of Lombard’s commercial transportation team, which helps businesses fund vehicles such as buses and coaches or heavy commercial trucks and trailers. “We matched funding to the various ages of the vehicles.
“We have put in place a rolling funding programme, which provides a consistent price, term and structure for each piece of equipment.”
Asset finance offers a “clean” method of financing the standard industrial machinery the company needs, says Mr Whawell. “We’ve always been a business that looks at matching the right type of debt to the right type of asset.”|
|Downtrend broken. Nice|
|Just buy. Company doing all the right things.Nice dividend next week.|
|Many reasons; a time lag for the wider market to catch up with what is being promised, the difference between expectation and sustainable delivery, etc. There was also quite a steep and strong rise after they announced the doubling of dividends and there was bound to be some falling away after such a quick rise.|
|This seems strange to me. Why is this company so disliked? Seems to be doing all the right things.|
|Bought quite a lot more on the drop below 150 yesterday.
Was concerned that someone knew something though, so more than a little nervous. Now a trading statement saying all is well and confirming the 12p per year dividend. Must be one of the biggest yields on the market - and anomalous in the context that it has just doubled its payout!|
|Anyone know why the big drop today? :-(|
|What a star performer STOB has been :-)|
|Forward yield 7.7% at 1.5425 offer price. All other things being equal, share price should still move up further from here in near term given the upbeat statement.|
|Doesn't need a rumour...doubling the divi is a very good start, then the positivity of the statement tops it off.|
|What's the rumour?|
|A nicely timed buy by Mr Woodford on the 13th, I must start to follow his buys more closely.
All good from Stobart today :-)|
|Breaking news, Heathrow airport expansion delayed.
Note also Boris is opposed to Heathrow expansion, which becomes more relevant with the prospect of him becoming PM. Bad news for Heathrow but positive implications for Stobart's own airport in the SE.|
|I wonder how much discussion there has been between Woodford and the board?|
|Looking at the share price performance the market likes it too :-) glad I held and topped up along the way :-)|
|Forward yield at 148p offer price now 8.1% so still some upwards movement in share price due.|
|Good to see Neilyb :-)|
|Woodford Investment Management LLP (Woodford), over 12% holding|