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11
Chief Operating Officer’s Report
Chief Operating
Officer’sReport
William Stobart, COO
Within the new structure of the Group, all Eddie Stobart
Limited (ESL) businesses; General Distribution, Environmental,
Chilled, Ireland, International, Warehousing; and Stobart Ports
are placed within the new Transport and Distribution division.
The Rail business, formerly comprising Freight Transport,
Infrastructure Engineering and Developments, will effectively
be split; so that Freight Transport is positioned within the
Transport and Distribution Division and the Infrastructure and
Developments businesses form the new Infrastructure and
Civil Engineering Division.
Eddie Stobart Limited (ESL)
Eddie Stobart’s advanced planning capability has allowed the
Company to introduce extensive ‘shared-user’ transport
networks. This unique, well-proven, systems-driven approach
gives Eddie Stobart a substantial lead against its competitors;
delivering the levels of responsiveness, flexibility and
transparency normally only associated with dedicated
services. This ‘pay as you go’ shared user system significantly
reduces waste and CO
2
emissions, whilst improving the
business’ profitability.
Shared user protocols and load consolidation has helped
Eddie Stobart cut wasteful, expensive empty miles to a
minimum. As a result the Company achieves industry-leading
levels of around 83% fleet utilisation. Additionally, the Eddie
Stobart model means that clients are incentivised to be more
efficient in their own operations, as any cost savings from
logistics will be shared between Eddie Stobart and the client.
ESL operates more than 2,000 44-tonne articulated and
drawbar combination units, which serve the road transport
needs of many of the UK’s leading names in FMCG
manufacturing and retail. Through 2010 and 2011 we are
upgrading our fleet as we take delivery of 1,000 new vehicles
from Scania GB. All the new vehicles comply with the latest
Euro 5 environmental standards.
We hope to introduce our highly innovative extended
Envirotrailer to British roads in the second half of 2011. The
new design; which requires very little extra fuel, and will help
cut congestion and reduce the carbon footprint; is in the late
stages of consultation, following a long process of
negotiation between Eddie Stobart and the Department for
Transport.
The addition of just two metres to the overall trailer length
increases carrying capacity by as much as 20%, whilst
remaining within the 44 tonne gross limit. If managed
effectively, the cost per pallet/cage to customers will remain
the same.
Eddie Stobart General Distribution
Our General Distribution unit is responsible for the Group’s
ambient transport provision. It operates more than 1,300, 44-
tonne, articulated and drawbar combination units. This road
freight capacity is supported by a comprehensive national
network of around 30 depots, that are strategically located
at key transport hubs across the UK.
Eddie Stobart Environmental
Environmental Transport was set up to service the logistics
requirements of the UK forestry, wood fibre, waste wood and
biomass industries. The UK produces around 40 million
tonnes of these products each year.
We have been quick to develop the transport potential of the
new generation of environmentally responsible biomass
power stations; transporting hundreds of tonnes from the
collection and processing sites, to the growing number of low
carbon electricity generators, as well as the more traditional
end users of this material, such as panelboard manufacturers.
With the acquisition of the remainder of Stobart Biomass
Products, Stobart Group will generate environmental
transport contracts worth approximately £70m per annum
in the next two to three years.
The newly implemented restructuring programme rationalises the different elements of the business
into a series of five coherent units. Operationally this now means businesses active in transport and
distribution can work more closely together; further exploiting the potential of the Group’s intermodal
offering. Similarly, the Group’s property assets are now managed together, whilst the business’
infrastructure and civil engineering works, air operations, and biomass source and supply operations
each have their own divisions; ensuring smooth steering of each operation and allowing cost
efficiencies and synergies between related activities to be fully developed and exploited.