The Stobart Group has decided to discontinue its Chilled operation as a standalone unit saying the business remained very challenging, it said in its interim management statement.
In October, the company reported that it had incurred £4.2m first half restructuring costs for the chilled business in a move to create a smaller more profitable operation. Sites at Corby and Alcester were closed and the fleet size reduced.
Overall, it said, the Transport and Distribution business continued to perform in an uncertain economic environment. The change to the chilled operation would not affect Stobart’s national network solution for customers.
“December trading was comparable to last year within similar economic circumstances. In the traditionally quieter months of January and February the division will be focused on cost control to reduce risk to the final quarter’s trading.”
The Air division incurred extra cost in the initial start-up phase, where the group invested heavily in training and service delivery to meet the faster than expected initial growth.
The Biomass division, while having its growth delayed by the timing of UK Government legislation, performed well against the realigned market and management expectations. “This has resulted in a good performance in the second half.”
In Stobart Estates negotiations were continuing on the disposal of several properties within the portfolio.
“Overall, the board expects the group’s operating performance for the year to be slightly below current market expectations,” it said. “The outturn for Estates will depend on the timing of disposals and valuations.”