Eddie Stobart unveils hefty losses as shares plunge
Logistics Development Group
11.45p
16:55 25/04/24
Eddie Stobart Logistics insisted it was back on a stable footing on Wednesday, after the embattled haulage firm finally published long-delayed results and resumed trading on the London Stock Exchange.
FTSE AIM 100
3,628.91
16:49 25/04/24
FTSE AIM All-Share
753.12
16:50 25/04/24
Support Services
10,523.75
17:09 25/04/24
Shares in Eddie Stobart were suspended in August after the discovery of an accounting error, which overstated adjusted operating profits by £2m. The Aim-listed company faced administration before striking a £55m rescue package with shareholder Douglas Bay Capital Fund (Dbay) in December. Dbay now holds a 49% stake.
Eddie Stobart said on Wednesday: “This transaction provided £70m of additional liquidity, putting the group on a stable footing and providing a platform from which to develop.”
Revenues in the six months to 31 May 2019 grew by 26% to £421.3m, but the underlying loss came in at £11.6m, compared to a restated profit of £600,000 in 2018. The statutory pre-tax loss was £199.8m, compared to a loss of £15.1m a year previously.
The numbers were hit by the accounting scandal and a £169.2m impairment charge, which reflected “current business performance and challenging trading conditions, an increased discount rate associated with higher gearing and a more prudent assessment of medium and long-term forecast profitability,” the firm said.
Looking ahead, Edie Stobart – famous for its green and red trucks – said it expected to report a “small underlying EBIT loss” for the full-year, but conceded it could be greater and remained subject to auditors.
The shares fell heavily as trading resumed, and by 1430 GMT they stock had plunged 87% to just 9p. The shares were suspended at 71p.