Sale of Air South West Limite

RNS Number : 9434S

Sutton Harbour Holdings PLC

20 September 2010

 



For Immediate Release                                                                               20 September 2010

Sutton Harbour Holdings plc ("Sutton Harbour" or the "Group")

Disposal

Further to our announcements earlier in the year, Sutton Harbour Holdings plc announces that it has now reached agreement to sell its wholly owned airline subsidiary, Air South West Limited, to Eastern International Airlines Limited. Completion of the transaction is expected to take place in October 2010 and is dependent on regulatory and security transfer approvals.

This transaction will result in a pre tax cash outflow of c.£2m after transferring advance ticket sales and working capital balances to be determined by completion accounts. Air South West Limited had a net carrying value of £3.8m at the balance sheet date of 31 March 2010. With volcanic ash disruption and continued difficult trading conditions Air South West Limited has incurred pre tax losses of approximately £1.5m in this financial year to date. These amounts, together with the costs of the transaction, will be recognised as losses from discontinued activities in the current year financial statements.

Air South West Limited sustained losses of £3.5m in the year ended 31 March 2010.

Air South West Limited was set up by Sutton Harbour Group and started trading in October 2003. Air South West Limited continues to operates scheduled services out of Plymouth and Newquay to 10 UK, Irish and Channel Islands destinations. Sutton Harbour remains the owner and operator of Plymouth City Airport.

Commenting on the disposal Michael Knight, Chairman of Sutton Harbour Holdings plc said:

"Air Southwest has made an important contribution to the Group since its inception and we look forward to seeing it continue to provide a valuable service to the region. This disposal will bring to an end to the Group's exposure to airline trading losses which have severely impacted the Group's financial results, particularly over the last eighteen months. Going forward we will now be able to focus our efforts on the regeneration and commercial property activities."

Enquiries:

Nigel Godefroy, Group Chief Executive                  Tel: [phone]

Sutton Harbour Holdings plc

Tim Worlledge, Evolution Securities                       Tel: [phone]

 Richard Day, Arden Partners                                 Tel: [phone]

 Paul Vann, Winningtons Financial                          Tel: [phone] or 07768 807631

 

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