Originally Posted by
canberra97
And as far as borrowing is concerned everyone does that, has none of you ever had a mortgage, well that's borrowing isn't it.
I'm a relative stranger to this part of PPRuNe. My comment about the borrowing may have been taken out of context. My underlying point (as a shareholder in Stobart not as an passionate SEN supporter) is the gearing is too high.
Stobart has been relatively debt free for a long time. Now the aviation domain of Stobarts is roughly 4 times the size of the transport domain, yet it only contributed 0.7 Mil EBITDA in the last 6 month reporting period... which with debt interest is < £0.
As a shareholder, I'm concerned that the aviation division is now the biggest part of the business yet contributes nothing to the bottom line.
By far my biggest concern is not the airport itself, it's everything connected to it. In pursuit of value Stobarts have been steadily buying up the aviation value chain in order to extract some value from *somewhere*. They should have proved the business case for the airport first.
They leased SEN. Fine.
They became an airport operator without any knowledge of the business. Sort of fine. Last year they hired some good people.
They built a train station to bring pax to the airport. It doesn't fulfil that purpose during the operating hours of the airport.
Still, no sign of making it work they went further;
Built a solar farm on the roof
Built a hotel
Acquired a regional airline
Acquired a aircraft leasing business
Signed heads of terms with Cityjet. which collapsed.
As the old saying goes. In the airline business the best way to make a million is to start with a billion.
Barling Magna has it right as an optimist "The potential gain from their investment is clear." I would say the potential loss from their investment is equally clear. I'm not doom mongering I really want it to work but they are over commited.
Finally, a massive thanks to the contributors to this thread, i've learned a lot more about SEN than I ever have from it's owner, who have held to their "Jam Tomorrow" line since day 1.