Newly restructured Stobart Group is in talks with up to 50 airlines to begin flying out of the firm’s Southend airport, according to chief executive Andrew Tinkler.
The company, which yesterday published its results for the six months ended August 2014, restructured earlier this year to focus on its aviation and energy divisions.
The aviation business is comprised primarily of airports at Southend and Carlisle. Tinkler told City A.M.: “Southend is an airport that can really serve London. You fly in and you’re off the plane and on to the train in 10 minutes if you’ve only got hand luggage.” Southend airport railway station links to London Liverpool Street.
Southend airport currently handles around one million passengers annually – with a 19 per cent jump in numbers in the first half of this yea. It aims to triple that number by 2017. “We’re seeing good traction with airlines we’re speaking to,” said Tinkler.
“Our aspiration is to achieve £10 Ebitda [earnings before interest, taxes, depreciation and amortisation] per passenger going through the airport.”
While he declined to name any of the airlines in discussion with Stobart, Tinkler stated that the firm was speaking to “all the airlines across Europe”, adding: “All of those airlines would potentially fly through Southend.”
On the energy side of the business, Stobart produces and transports biomass fuel. Tinkler said: “There are a lot of power plants being built because there’s talk about the lights going out, and we are making the fuel and transporting it to plants.”
The company contracts these services on a long-term basis, usually for 20 years or more. In addition to production and supply, the group also takes small equity stakes in new power plants being built.
Tinkler commented: “Once the plants are up and running, we have a secure contract for supply and income for the next 20 years, so job done really.”
Stobart’s share price barely moved yesterday, following the company’s announcement that revenue from continuing operations had increased by 17 per cent to £56.2m in the first half of the year. Loss before tax from continuing operations was £8.6m, which the firm attributed mainly to a one-off loan repayment.
Tinkler said the company was aiming to repeat the £8.7m Ebitda in the second half of 2014 and commented: “The highlight of these results to me is that in these six months, we sold off 51 per cent of Eddie Stobart, and raised quite a lot of money. We paid off £190m of debt and handed back £48m to the shareholders, and we really set in stone our divisions in aviation and energy.”