Stobart shareholders reap dividends
INFRASTRUCTURE and logistics giant Stobart is to double its annual dividend after delivering growth in its energy, aviation and rail operating divisions.
Stobart’s total dividend for this year will be 6p a share. From October it will start to pay quarterly dividends of 3p initially, doubling the current annual dividend to 12p.
There will also be scope to increase the level of the dividend or return cash to shareholders through share buybacks or special dividends, it said.
The Carlisle-based group says surplus cash has been generated through the exit of its infrastructure and investment portfolios at the right time.
The group confirmed it is on track to deliver its strategy to 2018 of driving shareholder value through the growth of its Energy, Aviation and Rail divisions, while generating a cash surplus through the exit of its Infrastructure and Investment portfolios.
In energy, the group’s target is to supply over 2 million tonnes of biomass fuel a year and grow EBITDA to £10 per tonne by 2018. It supplied 1 million tonnes in the year to 29 February 2016 and has contracts in place for plants to come on-stream between December 2016 and May 2018, to meet that target.
In aviation, the target is to grow passenger numbers at London Southend Airport to over 2.5 million passengers a year and deliver £8 EBITDA per passenger by 2018. London Southend Airport’s management team are in advanced talks with a number of low-cost carriers and full service operators, it said.
Stobart Air carried 353,000 passengers in the three months to 31 May 2016, an increase of nearly 17% and the group said it is considering opportunities with the airline to develop sustainable routes to and from London Southend Airport.
In rail, the group is on course to grow the business by 20% per annum by 2018 and is reporting a strong order book in place. It says it has made a successful start to the Gospel Oak to Barking electrification contract, part of TFL London Underground.
Ahead of its annual meeting today, Stobart also alluded to the outcome of the referendum on the UK’s membership of the EU.
It said: “The company benefits from diverse assets and sources of income, and its entrepreneurial culture leaves it well placed to respond to future developments and opportunities.
The group remains confident of delivering growth and good returns for shareholders over the coming years as it continues its strategy of growing our operating businesses to create value, and realising value for shareholders in our Infrastructure and Investments divisions.”