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Stobart closes chilled foods operation

Warrington, UK:  Stobart today said it was shutting its chilled goods operation as it warned its full-year figures will be below market expectations.

In an interim management statement, the firm says its transport and distribution division “continues to perform in an uncertain economic environment.”

“Within the division, the chilled operation has remained very challenging and, following a review, the management has decided to discontinue this business as a standalone unit,” it says.

Stobart’s chilled operations evolved from the former Innovate Logistics business that Stobart acquired from administrators in July 2008. It is likely that closing the chilled operation will see will see depots in Newark, Lincolnshire and Haywood, Lancashire close.

In October 2012 Stobart warned that the former Innovate operations had cost the firm £4.2m in the first half of its financial year, and it was expecting to incur similar costs in the second half.

In a trading update covering the period from September 1 to date, Stobart said its transport and distribution division as a whole, which accounts for the vast majority of its revenues, had performed as expected at the end of last year.

It said its iconic Eddie Stobart brand continued to “add value” and added: “December trading was comparable to last year within similar economic circumstances.

“In the traditionally quieter months of January and February the division will be focussed on cost control to reduce risk to the final quarter’s trading.”

In recent years, Stobart has moved into new areas, ranging airport management and renewable energy to law and property. Stobart said it remained in talks about selling several properties owned by its estates arm.

Shares in Stobart fell 3.52% — or 3.35p — to 91.70p on the announcement.