Stobart Group sees shares slide on forecast

SHARES in Stobart Group, owner of the Eddie Stobart haulage business, slumped 9 per cent yesterday after it warned annual profits are likely to be lower than previously expected.

The stock closed down 13.5p at 143p as the group blamed spending cuts at Network Rail's infrastructure maintenance operation.

It also reported shorter lead times and volatility in volumes at its core transport business and said it was concerned that business may be affected by January's VAT increase and the fall-out from yesterday's spending review.

The share slide came despite the company reporting a better-than-expected 24 per cent rise in half-year profits from continuing operations to 15.4 million in the six months to 31 August. Revenues were up 11.7 per cent to 243.7m.

It said the Eddie Stobart business - the largest of its divisions with a fleet of 1,850 trucks and 3,000 trailers - performed particularly well after contract wins with Tesco and Irn-Bru drinks firm AG Barr among others. Revenues for the division jumped to 219m from 188.7m a year earlier.

Stobart has operations covering road, rail, ports and air.