Solid start as Stobart benefits from new contracts

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Stobart Group owns the Eddie Stobart trucking business

8:20 am, June 21, 2010
Solid start as Stobart benefits from new contracts

Stobart Group Ltd (LSE: STOB), the Warrington-based logistics company, said trading was in line with expectations after a “solid” start to the year.

In a trading update following Friday's annual meeting, it said market conditions were still challenging although first quarter volumes were less volatile than in 2009.

The group, which owns the Eddie Stobart trucking business, the port of Widnes and Southend and Carlisle airports, said business performance was ahead of last year thanks to new contracts, including a deal to handle deliveries of chilled goods to Tesco stores from a new warehouse at the group's Widnes site.

Stobart said its new joint venture Stobart Biomass Products, alongside Cumbria-based A.W. Jenkinson, which supplies the UK renewable energy market with waste wood and other raw materials, had seen improved visibility of orders over the past two months “with further viable projects identified”.

Stobart announced at the start of this month that it had secured a new £100m, 10 year term loan from M&G. It added today: “This loan has partly been used to repay existing bank debt but, more importantly, will fund key capital projects across the group, the first of which will be the further enhancement of London Southend Airport following ministerial consent for the runway extension in March.”

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