Esken Limited AGM Update (7234K)
August 30 2023 - 2:00AM
UK Regulatory
TIDMESKN
RNS Number : 7234K
Esken Limited
30 August 2023
This announcement contains inside information for the purposes
of article 7 of the Market Abuse Regulation (EU) 596/2014 as it
forms part of domestic law by virtue of the European Union
(Withdrawal) Act 2018.
30 August 2023
ESKEN LIMITED
('Esken' or "the Group')
AGM Update
Esken, the Aviation and Renewables group, issues the following
update ahead of its AGM which will be held at 10am this
morning.
As previously announced, we have completed the strategic review
of our operating businesses and are now progressing with the sale
of our core operating businesses and residual non-core assets
through a managed disposal process with a view to returning any
remaining value to Esken shareholders.
Renewables
Our process with the preferred bidder to acquire the Renewables
division is significantly advanced and is progressing with a view
to concluding an agreement, subject to shareholder approval
shortly. While this is slightly later than originally envisaged,
the Board currently considers that the Group's liquidity headroom
remains sufficient to continue with the plans following the Group's
strategic review.
The challenges Esken Renewables experienced during the financial
year ending 28 February 2023 regarding biomass plant outages have
continued into the new financial year but there are now signs of an
improvement in gate fees and plant performance is expected to
improve during the second half of the financial year.
Aviation
Following the sale of Star Handling in May 2023 the Aviation
Division now comprises London Southend Airport (LSA) and a small
ground handling operation dedicated to supporting LSA. The airport
has benefitted during the summer season from the industry's strong
passenger demand which has seen the other London Airports return to
pre pandemic passenger levels. The partnership with easyJet has
seen the schedule grow from 3 destinations to 7 with increasing
frequency and strong load factors being experienced. This has
encouraged easyJet to add additional routes with Alicante,
Amsterdam, Geneva and Paris to operate through the winter this
year.
Against this positive backdrop, discussions continue on an
expanded summer schedule for 2024 with a number of airlines who
recognise the growing capacity constraints at London airports and
the strong offering from LSA in terms of operating cost and
passenger experience. The Jet Centre has also continued to see
positive traction in demand for its services.
The decision taken by the Esken Board to sell the airport in
order to crystallise shareholder value and secure the right
long-term partner best placed to support future growth has been
reinforced by this market momentum. While early in the process, we
have been encouraged by the initial level of interest from a range
of parties who recognise the long-term strategic value of LSA. We
will be focussing our engagement over the months ahead, with the
objective of achieving the best outcome for stakeholders.
Non-core operations
The previously announced sale of the interest in the Mersey
Biomass Energy plant completed on 3 August 2023 with the Group
receiving proceeds of GBP9m. Discussions continue to progress on
the remaining non-core assets with a view to realising value for
shareholders.
The remaining two aircraft of the original eight leased by
Propius following the demise of Stobart Air are due to be returned
to the lessor by mid-October. Landing gear overhaul on one of the
previously returned aircraft agreed with the lessor will then bring
to a conclusion all guaranteed lease payments and return condition
obligations in connection with Propius. The final outcome will be
within the amounts previously provided in the accounts.
In line with the stated strategy for managed disposals and the
ultimate wind down of the Group, we have undertaken a consultation
with staff at Group level and commenced the implementation of a
phased redundancy plan to reduce central costs as disposals are
completed.
Looking ahead, the Board's focus is on completing the disposal
of the Renewables division to reduce debt and provide support to
the growth of LSA as we progress the discussions to achieve a sale
of this key strategic asset.
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END
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