Stobart warns on short term performance

Logistics firm Stobart said its short term performance in transport is lower than market expectations as the current recessionary climate continues to hurt the sector.

In its update ahead of its interim results the haulage firm said it has positioned itself with a five divisional strategy as the economy hits demand.

It added that while short term trading has come under continued pressures, its streamlining and efficiency measures are expected to bring a more robust long term performance.

Subscribe to MoneyWeek

Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE

Get 6 issues free

Sign up to Money Morning

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Sign up

Stobart said: "The majority of the transport business has progressed well. The restructuring of the chilled business alongside bad summer weather was reflected in retail sales. This has resulted in some losses for the chilled fleet but the current restructuring will result in a more robust and streamlined business for the future."

While its Transport and Distribution operations endured difficult market conditions, the group saw progress at its air division, with passenger numbers up with easyJet and Aer Lingus.

New major contracts at its biomass division are now expected to start in the last quarter and the group is well positioned to deliver volume growth in 2012/13.

Given market conditions, progress at its estates division has been slower than anticipated, it noted. The Infrastructure and Civil Engineering division continues to add engineering development of the group's sites whilst focussing on profitable external work.

"The board continues to be firmly focused on driving the continued progress," the group concluded.

CJ