SOUTHEND - 4

[Expressflight]

Stobart own the lease of SEN for a term of something like 175 years - I cannot recall the exact figure. Southend Borough Council own the freehold: a similar situation as at LTN I assume but with a very much longer lease at SEN.

It's pointless quoting the net asset value of SEN in the Stobart annual report: approximately that just reflects the amount they paid for it plus any additional capital expenditure on improvements. Such an asset would be sold for a multiple of its book value, that multiple depending on its profitability and the future potential that the buyer may think it has to increase those profits. I believe a very small loss was made in the last financial year, but it would be rather surprising if that were not the case when large numbers of employees would have been recruited and trained prior to the 'opening' of the 'new' SEN with very little revenue coming it during that period.

Regarding the BIA period of ownership I well recall their MD coming round to see us prior to the deal being finalised. He looked at our ops board and was surprised to see some eight night movements scheduled for that day. I told him that there were at least 30 night movements on average taking account of ourselves, BAF and others. He told me that Southend Council had suggested that night flights were not popular and he felt he had been misled on that score. I don't think BAI actually wanted to run SEN into the ground; it was more a case of SBC just wanting rid of it and if they could discourage night flights and those pesky noise complaints that would be a bonus for them come the next elections. I think the terms of the management contract that BAI had from SBC was rather too restrictive to enable them to realise its full potential. When Regional took over and bought the lease their intentions were good but they simply didn't have access to the finance which they found would be necessary to regenerate SEN's fortunes.