Low property utilisation weighs on Eddie Stobart profit performance

Just weeks after warning on profits; parting ways with former chief executive Alex Laffey and receiving buy-out interest from asset management DBAY, Eddie Stobart Logistics said it expected to make a profit of £10 million to £11 million on turnover of £450 million in the first half of the year.

The road transport operator said that underlying EBIT for its financial year 2019 would be significantly below expectations as a result of:

• an adverse performance against an ambitious budget alongside delays in the implementation of operational efficiencies;
• Provisions made against customer recoveries, a significant proportion of which relate to underperforming contracts which have been exited during the year; and
• Delays on a significant property consultancy project and lower than planned property utilisation.

In a statement to investors, the Board at Eddie Stobart said it had seen significant growth in its operational capabilities over the past two years, by providing end-to-end supply chain solutions with some of the highest levels of customer satisfaction in the industry.

The Board said it believed that the immediate issues that the group faced could be addressed with positive steps already being taken. It said it had a solid business model and a robust customer base, with a clear path to sustainable growth and profitability.