Eddie Stobart Logistics

LN: ESL

£402.1m market cap

105p last close

Eddie Stobart Logistics is a market leader in end-to-end, multi-modal transport and logistics. Operations are primarily focused in the UK with some activities in mainland Europe. Key customer segments include retail, consumer, industrials and increasingly, e-commerce.

Investment summary

In January 2019 Eddie Stobart Logistics issued a trading statement for the financial year ended 30 November 2018. Group revenues were 3% above market expectations as the company experienced a steep acceleration in organic growth in H2 (+18% for FY18 vs +10%/+6% in H118/FY17). Recent acquisitions were also performing strongly. EBIT was in line with market expectations despite the revenue beat, which we believe reflects the task of integrating the acquired companies while at the same time experiencing very strong organic growth; margins remain well above the industry average. The stock continues to trade at a discount to UK and European competitors, despite higher profit margins.

Y/E Nov
Revenue (£m)
EBITDA (£m)
PBT (£m)
EPS (p)
P/E (x)
P/CF (x)
2016A 570.0 47.4 24.0 7.9 13.4 9.8
2017A 624.0 55.3 37.8 9.8 10.8 11.5
2018E 818.0 66.3 50.1 11.5 9.2 9.5
2019E 911.0 77.3 61.1 13.4 7.9 6.8
Last updated on 13/02/2019
Industry outlook

The trend for customers deciding to outsource logistics to achieve savings continues to provide a tailwind for growth, especially in the consumer and retail sectors where there are revenue and cost pressures. In our view, the outsourcing opportunity is large, with 45–80% of logistics and supply chain services in the UK and Europe still performed in house (according to EU Commission estimates).

Last updated on 13/02/2019
Sector
Industrials
Share price graph
Balance sheet
Forecast net debt (£m) 141
Forecast gearing ratio (%) 81
Price performance
%
1m
3m
12m
Actual 3.4 (5.4) (29.1)
Relative* 0.5 (4.0) (27.8)
52-week high/low 149.5p/97.5p
*% relative to local index
Key management
Alex Laffey CEO