SOUTHEND 5
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Read the annual report and accounts for FY16.
Join Date: Jun 2013
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Hats off to Stobart Group for floating off the logistics arm. They’ll realise £100m or so and still retain a holding in the newly floated Eddie Stobart. It’s what they do with the cash now that the big question.
"... increase the scope for adding value to the Group's other businesses through selective investment."
Is DirectorSpeak for “We’re going shopping”.
I hope they do invest in the rail and infrastructure divisions, just not projects connected to the airport!
"... increase the scope for adding value to the Group's other businesses through selective investment."
Is DirectorSpeak for “We’re going shopping”.
I suspect they'll look to inject investment in rail to support aviation in pursuit of margin gains. In other words exploring rapid passenger rail link from London Liverpool to SEN to compliment route to market.
Join Date: Apr 2016
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I think it's important to see the railway as a link to London and little else. None the population centres over 100,000 in Essex are linked directly to the airport, other than Rayleigh (around 100,000) and Southend itself. (I am not including London Boroughs within the historical Essex boundary). The railway does little for those in Southend, Basildon, Castle Point, Thurrock, Chelmsford, Harlow, Colchester and Clacton.
At this moment in the airport's evolution, it seems that few see it as a destination, rather it is a departure point for pleasure and leisure seekers. So throwing big money into rail - bearing in mind an express service calling Stratford and Liverpool St only, would probably only shave 6 - 8 mins off the journey - seems pointless.
I am not saying the rail-link is unimportant, without it, it ceases to be a London airport, but short of building a Maglev rail with trains capable of 300mph, I don't see any large scale investment making enough difference to be justified.
At this moment in the airport's evolution, it seems that few see it as a destination, rather it is a departure point for pleasure and leisure seekers. So throwing big money into rail - bearing in mind an express service calling Stratford and Liverpool St only, would probably only shave 6 - 8 mins off the journey - seems pointless.
I am not saying the rail-link is unimportant, without it, it ceases to be a London airport, but short of building a Maglev rail with trains capable of 300mph, I don't see any large scale investment making enough difference to be justified.
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Proceeds of divestment in Eddie stobart
I think it's important to see the railway as a link to London and little else. None the population centres over 100,000 in Essex are linked directly to the airport, other than Rayleigh (around 100,000) and Southend itself. (I am not including London Boroughs within the historical Essex boundary). The railway does little for those in Southend, Basildon, Castle Point, Thurrock, Chelmsford, Harlow, Colchester and Clacton.
At this moment in the airport's evolution, it seems that few see it as a destination, rather it is a departure point for pleasure and leisure seekers. So throwing big money into rail - bearing in mind an express service calling Stratford and Liverpool St only, would probably only shave 6 - 8 mins off the journey - seems pointless.
I am not saying the rail-link is unimportant, without it, it ceases to be a London airport, but short of building a Maglev rail with trains capable of 300mph, I don't see any large scale investment making enough difference to be justified.
At this moment in the airport's evolution, it seems that few see it as a destination, rather it is a departure point for pleasure and leisure seekers. So throwing big money into rail - bearing in mind an express service calling Stratford and Liverpool St only, would probably only shave 6 - 8 mins off the journey - seems pointless.
I am not saying the rail-link is unimportant, without it, it ceases to be a London airport, but short of building a Maglev rail with trains capable of 300mph, I don't see any large scale investment making enough difference to be justified.
Currently the 12p annual dividend costs Stobart Group in excess of £41m. The Group cannot cover that from operating profit so it has to sell assets to pay shareholders. The proceeds from the Eddie Stobart deal will cover the dividend for the next 2 years and a bit.
The downside is that the shareholding in Eddie Stobart gave the Group approx £7m per annum in income. This is now lost and with airport not profitable and the airline leasing business facing increased costs (less profitability) due to the sales and leaseback deal, the future is a full gamble on achieving 2.5m pax and then selling the asset.
I can't see that happening.
asdf1234
If you read the Stobart Group statement issued yesterday you will see that it says:
"The proceeds will support the Group's progressive dividend policy and increase the scope for adding value through selective investment."
Therefore the first paragraph of your post was a little misleading in suggesting that all the proceeds will be used to cover future dividend payments. I think it's best to await the annual results announcement in three weeks time rather than making pessimistic assumptions now.
If you read the Stobart Group statement issued yesterday you will see that it says:
"The proceeds will support the Group's progressive dividend policy and increase the scope for adding value through selective investment."
Therefore the first paragraph of your post was a little misleading in suggesting that all the proceeds will be used to cover future dividend payments. I think it's best to await the annual results announcement in three weeks time rather than making pessimistic assumptions now.
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asdf1234
If you read the Stobart Group statement issued yesterday you will see that it says:
"The proceeds will support the Group's progressive dividend policy and increase the scope for adding value through selective investment."
Therefore the first paragraph of your post was a little misleading in suggesting that all the proceeds will be used to cover future dividend payments. I think it's best to await the annual results announcement in three weeks time rather than making pessimistic assumptions now.
If you read the Stobart Group statement issued yesterday you will see that it says:
"The proceeds will support the Group's progressive dividend policy and increase the scope for adding value through selective investment."
Therefore the first paragraph of your post was a little misleading in suggesting that all the proceeds will be used to cover future dividend payments. I think it's best to await the annual results announcement in three weeks time rather than making pessimistic assumptions now.
Increase the scope for adding value through selective investment...
One is definite, the other is a vague non binding statement of future intent.
Paying the dividend out of asset sales has been, and continues to be, the Group's focus. I don't expect the forthcoming annual report to differ from that stated policy.
The gamble is as stated. Sell the Group's current assets to support the future dividend policy to give time to the airport to start delivering profits so that it too can be sold with the proceeds going to shareholders.
My position is that they will not achieve profitable operations mainly because EasyJet scares off the competition. Something I have always maintained from the day they first invited EasyJet in. The fact that the only viable competition the airport can attract is their very own airline does support my assertion.
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The rail link to London isn't Stobart's to invest in, and the group include a whole unit covering rail transport
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My position is that they will not achieve profitable operations mainly because EasyJet scares off the competition. Something I have always maintained from the day they first invited EasyJet in. The fact that the only viable competition the airport can attract is their very own airline does support my assertion.
Imagine this for a second. Stobart will have a warchest of £100 odd million from the divestment and FlyBe has a market capitalisation of around £87m
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Old chestnut this one. FR would have a big (probably too big) an issue, but then they specified a downgraded (economic) engine spec. Others, well what routes would the want to operate with how much fuel? Many a 737 has landed and taken off from SEN, would a modern 737-800 be able to work the runway? With every seat occupied? I think the real question is would any operator be enthusiastic about joining easyJet in running any route that limited the amount the of seats that could be sold to less than 100%?
DC3 Dave
As you say it's an old chestnut. Regardless of a carrier's engine choice it's the landing distance that rules out economic B738 operations at SEN. Luxair operated two full pax load charters to PUF (Pau, France) but both arrived SEN empty. These are the only 738 commercial flights that SEN has seen.
As you say it's an old chestnut. Regardless of a carrier's engine choice it's the landing distance that rules out economic B738 operations at SEN. Luxair operated two full pax load charters to PUF (Pau, France) but both arrived SEN empty. These are the only 738 commercial flights that SEN has seen.
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I was always aware one of RYR`s criteria & a very basic requirement for op`s was CAT11...Kinda rules SEN out of any consideration really....Plus their 738`s engines are fixed de-rated to throw you another swerve & to save any further tedious R/W length discussion here.....Good luck...SS
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I don't find R/W discussions tedious, mainly because I often wonder how Stobart visualised the future when they decided to spend millions on a 300m extension and re-routing Eastwoodbury Lane. They must have believed the R/W would serve the purpose intended or why spend all the money? I'm not saying the airport can't have a solid future, but they have to live with the fact that the R/W doesn't quite cut the mustard for a large number of potential operators.
I don't find R/W discussions tedious, mainly because I often wonder how Stobart visualised the future when they decided to spend millions on a 300m extension and re-routing Eastwoodbury Lane. They must have believed the R/W would serve the purpose intended or why spend all the money? I'm not saying the airport can't have a solid future, but they have to live with the fact that the R/W doesn't quite cut the mustard for a large number of potential operators.
Of course Stobart didn't have the choice of extending the runway by more than 300m as a Code C runway cannot have a TODA or ASDA of more than 1,799m and its location means that it will always be Code C. So it was a case of making the best of what they had to work with while anticipating it would be just sufficient to attract the necessary business.
I agree with fatmed that the new generation of mid-size airliners have better runway performance and that does open up more potential business for SEN.
I agree with fatmed that the new generation of mid-size airliners have better runway performance and that does open up more potential business for SEN.