SOUTHEND - 4
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In Storbat’s 2012 annual report Southend is making a loss but the airport is now valued at £115m.
Don't know whether that makes a sale more or less likely.
Don't know whether that makes a sale more or less likely.
Last edited by LTNman; 19th Feb 2013 at 18:12.
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Stobart Air Division made a loss due to the £100million+ investment they spent on SEN, but I wouldn't have thought the airport itself is operating at a loss especially when you have just signed a 10 year deal with easyJet. I could be wrong...
Can anyone shed some light on this area?
Can anyone shed some light on this area?
Last edited by tws123; 19th Feb 2013 at 18:32.
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SEN will not be sold they have spent too much time and money on it and would make a loss by selling now. I do think Carlisle should be sold as they got it cheap and the time and money its draining from the company and yet still nothing has happened i think it's a lost cause.
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Stobart Air Division made a loss due to the £100million+ investment they spent on SEN, but I wouldn't have thought the airport itself is operating at a loss
I would have thought that if Southend did come on the market there would be a queue of buyers if it was priced right.
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Re. Barling Magna's Comments
Just for the record: It was British Airport's International who were the BAA 'stooge' company who did their best to run Southend into the ground and very nearly succeeded. Regional Airports took over from them and managed to keep the airport alive in the intervening years until Stobart purchased the lease from them.
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.
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.
Last edited by Expressflight; 20th Feb 2013 at 07:36. Reason: Grammar
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Better a long term lease as Stobart can plan for the long term. With regard to the conditions of the lease what does Stobart pay the council? Would it be per passenger as per Luton or is it a fixed price each year?
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Comment taken from this article
Southend Airport will not be sold, owners vow (From Echo)
Southend Airport will not be sold, owners vow (From Echo)
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It is OK for Stobart to say that they will not sell Southend Airport (hope they don´t after all he effort they have put in) but if the banks - who hold the purse strings - say sorry it has to go - the board of Stobart will have no say in the matter.
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..... but our banks are scions of probity and honest sound advice. They support businesses to the hilt. They will have undertaken due diligence before advancing funds to Stobart. They will be fair, clear eyed and infallible in their decison making; that's why their executives deserve the bonuses they receive.
Why would the bankers pull the plug on one of the more successful parts of Stobart's growth startegy?
Oh. Yes. Ahhh....... right. OK.
Why would the bankers pull the plug on one of the more successful parts of Stobart's growth startegy?
Oh. Yes. Ahhh....... right. OK.
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Yeo
You clearly don't know alot about the company as they are not owned by the banks, the biggest shareholder being Invesco and other investment company's and also some of the board. As for Tesco they have 1% of the company they are however one of the company''s biggest customers so may have a bit of influence but not a great deal.
You clearly don't know alot about the company as they are not owned by the banks, the biggest shareholder being Invesco and other investment company's and also some of the board. As for Tesco they have 1% of the company they are however one of the company''s biggest customers so may have a bit of influence but not a great deal.