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Southend-3

Old 21st Jun 2023, 12:31
  #1041 (permalink)  
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As they don’t own Southend but operate it as a franchise what are they actually selling that has any value?
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Old 21st Jun 2023, 12:54
  #1042 (permalink)  
 
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Originally Posted by LTNman
As they donít own Southend but operate it as a franchise what are they actually selling that has any value?
I understand they have a long lease on the Airport, rather than operating it as a franchise. But I imagine the practicalities are similar. If it's a viable, profitable business then for the right price a purchaser may be interested in acquiring it. So it would have a tangible value as a going concern. If the business is perpetually loss making but there is no significant asset value then unless you can walk away from the lease I guess the best you can hope for is to pay someone to take it off your hands.....
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Old 21st Jun 2023, 13:51
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As I understand it, the "material risk" relates to uncertainty over the disposal of the Biomass Division. Once sold, Esken's cash position is much healthier, but there is no certainty over the timing....
So once they've sold off the bit making money, they'll be a lot better off? The Esken way! ​​​​​​​
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Old 21st Jun 2023, 14:18
  #1044 (permalink)  
 
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Originally Posted by LTNman
No surprises there. To cut its loses further they would need to close the terminal and boot Easyjet out. I can understand why this would be painful but the easyjet flights at Southend donít have the volumes needed to turn a profit. Come this winter it will only get worse. With Easyjet slowly ramping up flights it will be a long time before Southend will see a profit and Esken hasnít got the resources to last out. Also despite the claims of new airlines and routes the cupboard seems to be bare..
Reading your post in isolation one wouldn't guess that a buyer is actively being sought for SEN. Of course easyJet aren't currently generating enough volumes for SEN to turn a profit but what they are doing is giving some indication that SEN could be revitalised by a new owner with sufficient funds to offer the necessary incentives to increase easyJet's activities and attract other operators. Esken have openly said that all airline deals in the past few years have had to be on strictly commercial terms that generate profit in themselves. In other words they have been trying to attract custom with one hand tied behind their back. Esken still have ring-fenced resources of £5.3m from Carlyle Global in the bank to keep SEN running so will have at least 12 months to find a buyer. I'm not suggesting that will necessarily be easy and what success they will have remains to be seen. That is the main take-away from these Annual Accounts & Report. That and the probable necessity of concluding the sale of the Biomass Division in the interim to keep Esken as a going concern.
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Old 21st Jun 2023, 14:52
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I think I read a long time ago that the turning point from loss to profit was 1.25m passengers a year. They still have a long way to go but as Esken has found out you can spend the money freely and get little return. It might be a case of selling the lease for £1 and walking away could be the best option. So who owns the infrastructure that Stobart built? The Council, as the owner of the land, or Esken?

If Esken fails maybe the airport ends up with no debts so can start again with a new debt free lease and with all the infrastructure in place or maybe the infrastructure has value that can be sold for the duration of the existing lease?

Last edited by LTNman; 21st Jun 2023 at 15:41.
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Old 22nd Jun 2023, 13:54
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Interesting quirk of Southend business model vs. similar peers. Because they have the train terminal right next to the terminal, a higher proportion of users choose to take the train - great from green perspective, but dramatically reduces car parking revenues which for some is the primary income stream for a typical regional airport, aside from property rentals - if they have property to rent that is! Hardly anyone makes money from aviation-related income.
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Old 22nd Jun 2023, 14:09
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I thought that SEN received part of the train ticket price, which would go some way towards compensating for the reduced car parking revenue. After all they do own the station.
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Old 22nd Jun 2023, 14:16
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Originally Posted by Expressflight
I thought that SEN received part of the train ticket price, which would go some way towards compensating for the reduced car parking revenue. After all they do own the station.
They do. Over 90% of the ticket price to or from the station.
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Old 22nd Jun 2023, 20:58
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Well at least they made one good deal.
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Old 22nd Jun 2023, 21:54
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My understanding was that they owned pretty much all the infrastructure around the airport including the station and hotel so they must be making something from that to alleviate the reliance on car parking.
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Old 22nd Jun 2023, 22:02
  #1051 (permalink)  
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Which means they were also getting 90% of the ticket price of all the commuters from the local area that started using the station too instead of the pre existing stops. The operator did kick off about this not sure what the outcome was
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Old 22nd Jun 2023, 22:34
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So on s standard one way Ticket from Liverpool Street to Southend Airport railway station, the operator gets £2.01, that can't be right!
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Old 23rd Jun 2023, 06:25
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Originally Posted by pabely
So on s standard one way Ticket from Liverpool Street to Southend Airport railway station, the operator gets £2.01, that can't be right!
That is correct. You have to remember that Stobart built the station at their own expense. The deal is not permanent but is long term.
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Old 26th Jun 2023, 11:38
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https://simpleflying.com/london-sout...-what-we-know/
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Old 27th Jun 2023, 10:27
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EZY have released early S 24 flights. Looks like summer starts along the same lines as this year, hopefully with a new route or two to follow in the coming weeks.

One disappointment. CDG does not appear to continue into summer as anticipated at this stage. Particular shame with the Paris Olympics in 2024.
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Old 27th Jun 2023, 11:56
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Originally Posted by DC3 Dave
One disappointment. CDG does not appear to continue into summer as anticipated at this stage. Particular shame with the Paris Olympics in 2024.
Hardly an event that would justify a commitment throughout Summer. Probably somewhere to avoid with inflated accommodation prices. EZY based aircraft in Paris will make more money to somewhere like Corsica in Summer. Always thought this was a Paris slot holder route than a serious commitment to SEN.
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Old 27th Jun 2023, 12:01
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There also tends to be extensive availability of cheap seats on Eurostar in summer - it's a competitive market.
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Old 27th Jun 2023, 16:52
  #1058 (permalink)  
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https://www.echo-news.co.uk/news/236...er-fence-line/
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Old 27th Jun 2023, 20:52
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One disappointment. CDG does not appear to continue into summer as anticipated at this stage. Particular shame with the Paris Olympics in 2024.
The Paris based routes are probably not on sale yet. Iím pretty sure U.K. > bucket & spade routes go on sale early due to earlier booking habits. Very few people book flights to cities such as Paris so far in advance.
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Old 27th Jun 2023, 21:44
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At a time when the airport needs every friend it can get this expansion of the perimeter fence will probably alienate the spotter/enthusiast community. I remember way back when the airport's original expansion plans were produced that there was a dedicated building for spotters included in the plans, replacing the old "Waving Off Terrace" on the terminal roof. That didn't survive long once the plans were approved.......
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