Southend Airport-owner Stobart Group cuts its fourth-quarter dividend

James Booth
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Stobart Group has cut its fourth-quarter dividend (Source: Getty)

Stobart Group has today said it plans to cut its fourth-quarter dividend to focus on future investments.

The Southend Airport-owner said it had examined the dividend as part of an ongoing capital review and had decided to cut it to 1.5p per share.

This means that total dividend paid in the financial year will be 15p per share, compared to 16.5p per share paid in the previous financial year.

Its share price fell 10.6 per cent this morning to 176p following the news.

Stobart’s board said it has paid dividends to shareholders of £105m since March 2017, funded via disposals of non-strategic assets.

It said capital expenditure over the same period has been £67m.

The board said it owns non-strategic assets with a value of £149m, but said its medium term plan was to use proceeds from further disposals to “invest in value-creating opportunities and “maintain a strong balance sheet”.

It said it plans to update the market on the results of its full capital review in March 2019.

Robert Byde, an analyst with Cantor Fitzgerald, said: "The group has significant growth opportunities with its aviation and renewable energy fuel divisions, which require further investment. Hence, we welcome this announcement as a sensible and necessary first step in the reallocation of capital to help deliver an ambitious growth plan."

Stobart's top executives have been locked in a bitter court battle recently with former chief executive Andrew Tinkler centring around his dismissal.

The trial finished last week with a judgment expected early next year.