Eddie Stobart hires brand specialist for name challenge

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Eddie Stobart Logistics has hired a brand specialist to help it decide whether to continue to license the Stobart name when the current deal with the Stobart Group runs out in February next year.

It could decide to adopt a new name or there are three options to continue with the licensing arrangement beyond 2020:

* Pay £3 million a year for continued use of the licence

* Purchase a perpetual licence for £15 million for use in the logistics market

* Purchase a perpetual licence for £50 million for unrestricted use

Chief executive Alex Laffey said: “We remain committed to evaluating all of our options around our name and leading brand. We have engaged with a brand specialist and talked to customers, shareholders and employees regarding our brand and their perceptions of the value it brings.

“The board remains confident that whatever the outcome, value will be created and retained in the long-term for all key stakeholders.”

The group increased revenue by 35 per cent to £843.1 million in the year to 30th November 2018, driven by strong performances in its E-commerce business (up 65 per cent) and its Retail business (up 43 per cent).

Operating profit was up 21 per cent at £37.5 million.

Laffey said: “We continue to develop our end-to-end supply chain capabilities and in June acquired The Pallet Network, which gave the group a presence in pallet distribution across the UK and provides cross-selling opportunities to serve our customers’ growing needs. All of our acquired businesses traded in line with expectations during the year and delivered their planned synergies.

E-commerce saw the biggest growth last year with sales up 65 per cent to £171m. This was followed by Retail where sales grew 43 per cent to £241.1m. Sales in Manufacturing, Industrial and Bulk were up 16 per cent to £211.1m. The Consumer sector saw sales grow 26 per cent to £182.1m.

The annualised impact of new contract wins was £162m, and contract renewals had an annual value of £119m.

The company this year opened an 840,000 sq ft warehouse in Corby to support its growth in e-commerce. And it is seeking planning permission for a 644,000 sq ft warehouse at Appleton next to its operational headquarters. It hopes to have this operation in the fourth quarter of 2020.

Looking ahead, Laffey said: “While we remain mindful of the current political and economic uncertainty, we are confident that our unique operating model provides us with the flexibility to respond rapidly to changing market conditions.”

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