Stobart targets second half growth

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The Stobart Group is looking for further growth in the second half of 2010, despite the fact that the economic environment remains challenging.

In its pre-close trading statement ahead of its interim results on 20th October it said that group performance in the first six months of the year was  in line with expectations and significantly ahead of the same period last year.

Traffic volumes at Eddie Stobart remained strong, benefiting from new contracts including a recent significant new contract win for transport and warehousing for AG Barr worth around £7m a year.

“Increased volume volatility has created some challenges for the business which are being addressed through working closely with our customers. Overall trading is in line with expectations and significantly ahead of last year. The full effect of the previously announced A W Jenkinson and Tesco Widnes chilled contracts will add growth in the second half.”

The rail freight business was performing well and new routes were being developed with customers.

However, in the rail engineering services business uncertainty over future government spending meant that demand from Network Rail remained flat.

“As a result, overall performance for this division is slightly below expectations but the business continues to present exciting opportunities for the group with major projects at London Southend Airport and other group sites and these projects also ensure that plant and labour in the division are use.”

Performance at Stobart Ports was marginally ahead of expectations as a result of tight cost control with steady volumes but limited growth. After a successful marketing day, management are pursuing opportunities to further develop the remaining 95 acres of land at the inland port.

At London Southend Airport, both the new railway station and control tower were still on target to be virtually completed by the end of 2010.

Trading at Stobart Biomass Products, which was acquired earlier in the year, was in line with expectations.

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