Delivering for our stakeholders. Annual Results May 2018

Transcription

1 1 Delivering for our stakeholders Annual Results May 2018

2 2 Non Annual Results 2018 Contents 1. Introduction (IF) 2. (WB) 3. Aviation (GJ) 4. Carlisle Lake District Airport (AT) 5. Energy (BW) 6. Rail (RL) 7. Infrastructure (RL) 8. Investments (RL) 9. (RL) 10. Divisional Outlook (WB) 11. Appendix

3 3 Introduction Non Highlights Increased underlying EBITDA to 135.2m All operating divisions improved underlying EBITDA year-on-year Realised cash of 111.9m following the partial disposal of the investment in ESL Returned 74.1m to shareholders via dividends and share buy backs Final dividend of 4.5p being proposed, to be paid in July 2018 Warwick Brady appointed Chief Executive Officer on 1 July 2017 Richard Laycock appointed Chief Officer on 1 February 2018 Nick Dilworth appointed Commercial Director on 30 October 2017

4 4 highlights Increased turnover Turnover increased by 112.6m (87%) with airline included Non Turnover Improved profitability Underlying EBITDA of 135.2m (+294%) Underlying profit before tax of 117.4m Both of these measures include the 123.9m profit on partial disposal of Eddie Stobart Logistics Balance sheet and returns to shareholders Gearing decreased to 9.0% (February 2017: 31.1%) (net debt/total equity) Infrastructure realisations generated 27.3m net cash proceeds (2017: 52.7m) Returned 74.1m to shareholders during the period through dividends and buy backs Final dividend of 4.5p being proposed 242.0m Underlying EBITDA 135.2m Returns to shareholders 74.1m

5 5 Delivery of shareholder value 3 year share price v FTSE 250 Non m % 180% 160% 140% 120% 100% 80% 60% 40% 20% 0% 5 May 15 Sep 15 Jan 16 May 16 Sep 16 Jan 17 May 17 Sep 17 Jan 18 Stobart FTSE 250 Dividends Source: London Stock Exchange website 112.5m of dividends returned to shareholders since 1 March m returned to shareholders in the year, including dividends of 58.1m and share buybacks of 16.0m (net) As said at interims, dividends being supported by asset disposals as operating cash grows -20%

6 6 and objectives Stobart value wheel Key observations Non Stobart Logistics expertise and customer focus Engaged, motivated and skilled workforce Great potential for growth Entrepreneurial company Valuable Superbrand Trusted to deliver Identify and exploit opportunities in Aviation sector, London capacity constraints and customer service Drive efficiencies and growth within Energy division Continue to grow our innovative Rail & Civils division Realise assets and investments at the right time Invest in our people Ambitious growth targets set for divisions

7 7 Stobart Aviation Industry situation Capacity crisis at London airports UK passenger experience needs to improve Aviation growth continues to outperform GDP Opportunities for Stobart across the sector Non The strategy Continue to grow and develop our London airport with great customer service Develop our Aviation Services business Stobart Air to play a leading part in regional airline consolidation Continue to develop our wider aviation businesses such as the Jet Centre

8 8 Stobart Aviation Stobart Aviation aims to deliver a first class passenger experience. Non London Southend Airport (LSA) was the fastest growing UK airport in % increase in passenger numbers at LSA Launch of new Stobart Jet Centre Stobart Aviation Services won external contract 9% increase in passenger numbers on our regional airline Stobart Air Commercial flying from Carlisle Lake District Airport to begin in June 2018 with Loganair We anticipate continued strong growth and have challenging ambitions for 2022

9 9 summary - Aviation Non Aviation m Revenue Underlying EBITDA Passenger numbers LSA 1,126, ,000 Passenger numbers Stobart Air airline 1,684,000 1,542,000 Revenue increase due to airline and Propius being included for the first time Hotel running at 84% occupancy In advanced discussions with F&B operators to introduce national brand concessions in summer 2018 Added three new airlines in the year Investment in relation to awareness, route development, branding, marketing and airline incentive deals

10 10 Stobart Aviation Services case study Non Stobart Aviation Services was successfully awarded first external contract Using logistics brand and knowledge to gain a competitive advantage Appointed Graeme Undy as MD, formerly Eddie Stobart Logistics Long-term contract with easyjet at London Stansted Airport for ground handling services commenced March 2018 Using real time technology, matching activity to resources High level of customer service and attention to detail

11 11 Carlisle Lake District Airport case study Non Stobart Rail & Civils have delivered regional airport within six months for a significantly reduced cost, without compromising quality Driving property strategy and creating a logistics hub at the airport Increasing connectivity Well located, just off the M6 Motorway

12 12 Stobart Energy Stobart Energy is the number one supplier of biomass in the UK, sourcing, processing and transporting fuel to renewable energy plants under long-term index linked contracts. Non On course to meet 2018 strategic targets 2.0m tonnes annual run rate: 1.3m run rate in the final quarter of year end February 2018 with a further three new plants to come on line in 2018 EBITDA per tonne of 10: at 28 February 2018 proves the business model Key challenges to delivering the plan: Plant performance Environment Agency Repairing / rebuilding supply chains

13 13 summary - Energy Non Energy m Revenue Underlying EBITDA Tonnes sold (number) 887, ,000 Underlying EBITDA per tonne ( ) % increase year-on-year in underlying EBITDA per tonne Revenue decrease due to reduced transport fleet size which will build back up as and when new plants come on line Volume increase of 14,000 tonnes driven by commissioning of new plants offset by one-off customer administration and strategic exit from export market Impact of commissioning issues and delays resulted in 3.8m of non-underlying costs. We have negotiated compensation packages with the new plants to contribute towards some of these costs

14 14 Tilbury example of issues faced Actual v forecast tonnages Non

15 15 Non Contract lengths and annual tonnages top 10 plants Average Length > 14 years Average Annual Tonnes > 170, , , , , , ,000 0 A B C D E F G H I J Years Annual Tonnes Average length Average Tonnes 0

16 16 Progress towards 2022 plan Drive efficiencies from current operations Target other recycled fibre (RCF) plants Expansion into new waste streams refuse derived fuel (RDF) and solid recovered fuel (SRF) New business opportunity of over 3m tonnes and growing Widening same offering with innovative Full Service Solution to new and existing plants Full Service Solution driven by desire to innovate and challenge traditional ways of operating Non

17 17 Stobart Rail & Civils Stobart Rail & Civils is one of the UK s leading names in rail maintenance, repair and improvement. Non Strong pipeline of work c. 75m Considerable value added at sites; LSA, CLDA and renewable energy processing sites Achieved good margins across all contracts won throughout the year Working with external contract partners Network Rail, BAM Nuttall, AMEY, ARUP Devegetation framework continues to develop strongly Maintained five-star Quality Management System for a fourth consecutive year

18 18 Rail & Civils supporting internal infrastructure Non

19 19 summary Rail & Civils Non Rail & Civils m Revenue Underlying EBITDA External revenue reduced in the year as a major contract was completed in the prior year, but revenue for work for internal sites increased Profitability has been maintained and improved Profits on internal capital work are eliminated on consolidation

20 20 Stobart Infrastructure Our Infrastructure division has a strong track record of enhancing the value of the s assets. Non Four non-strategic asset disposals in the year generating cash proceeds of 27.3m All disposals at or above book value Advance discussions for further asset disposals

21 21 summary - Infrastructure Non Infrastructure m Revenue Underlying EBITDA Number of disposals 4 3 Net proceeds from disposals 27.3* 52.7 Infrastructure asset values *of which 2.3m remains outstanding at the year end.

22 22 Stobart Investments Stobart Investments holds the s 12.5% investment in Eddie Stobart Logistics. Non Significant profit on partial disposal of 49% investment in Eddie Stobart Cash proceeds of 111.9m (net) received in addition to 12.5% investment in newly AIM listed Eddie Stobart Logistics Recent results were positive with a 14% increase in revenue and a 17% increase in underlying EBIT to 48.5m 0.6m dividend received in the year, with a 4.4p dividend announced, payable in June 2018, totalling 2.0m for the Stobart owns the Eddie Stobart brands and licence them to ESL on a 15 year agreement

23 23 summary - Investments Non Investments m Underlying EBITDA profit on partial disposal of Eddie Stobart Underlying EBITDA Eddie Stobart dividend 0.6 Underlying EBITDA Eddie Stobart share of profits (pre disposal) Underlying EBITDA total

24 24 Income statement Non m revenue Underlying EBITDA by division Energy Aviation Rail & Civils Investments Infrastructure Central costs and eliminations (13.3) (8.1) Underlying EBITDA

25 25 Underlying EBITDA to profit before tax bridge Non (1.8) 1.0 (15.3) 120 (1.7) (9.0) 110 (0.8) 1.3 (4.1) 100 (4.2) Underlying EBITDA Foreign exchange Swaps Depreciation Net interest Profit before nonunderlying items New business and contract set up costs Transaction costs Bad debts Litigation and claims Amortisation (non-cash) Profit before tax

26 26 Balance sheet Non m Intangible assets Tangible assets Investment and non-current receivables Current assets (excluding cash) Cash and restricted cash Gross assets Gross liabilities (248.3) (278.5) Net assets Net debt Gearing 9.0% 31.1%

27 27 Cash flow analysis Non m Profit/(loss) before tax from continuing operations (8.0) Add back: Non-cash adjusting items (120.2) 1.9 Working capital movement and tax Cash flow from operating activities (9.5) (1.7) Cash flow from investing activities Cash flow from financing activities (159.0) (17.5) Increase in cash Cash at the beginning of the year Cash at the end of the year

28 28 Divisional outlook Non Aviation Wider strategy in place to invest in aviation sector London Southend was the UK s fastest growing airport in 2017 Aviation Services growing after winning contract for easyjet at Stansted Our regional airline, Stobart Air, is growing and is a valuable asset Energy Short-term delays in the commissioning will not impact long-term volumes focused on further efficiencies and growth Rail & Civils Will continue to build external relationships and add value to the wider Infrastructure and Investments Continue to realise assets and investments at the right time

29 29 Appendix: Operational date of plants Non 2016 Annual Report 2017 Annual Report Plant First wood Commercial takeover Expected volume (tonnes) First wood Commercial takeover Expected volume (tonnes) Mersey Bioenergy Oct 2016 Mar ,614 Dec 2016 May ,561 Tilbury Jan 2017 May ,000 Mar 2017 Jul ,105 Templeborough Jan 2017 May ,813 Jul 2017 Nov ,007 Margam Oct 2016 Jan ,025 Aug 2017 Dec ,970 Port Clarence Aug 2017 Dec ,500 Nov 2017 Mar Cramlington Jan 2018 May ,050 Jul 2017 Dec ,050 1,346, ,693 Latest notification Variance of latest to 2017 Annual Report Plant First wood Commercial takeover Volume to date (tonnes) First wood (months) Commercial takeover (months) Volume (tonnes) Mersey Bioenergy Dec 2016 May , (53,698) Tilbury Mar 2017 May , (251,771) Templeborough Apr 2018 Jul , (197,125) Margam Apr 2018 Jul (175,584) Port Clarence Jun 2018 Sep Cramlington Jul 2017 May , (17,492) 245,023 (695,669)

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