Marc Bannister’s Annual Statement 2012

It has been over ten years since I started professionally collecting model cars. Since then, all aims, objectives, goals and targets have been exceeded. The year-end remains at the end of January as opposed to the end of December due to the New Year’s celebrations.

In July 2001, there was just one car and half a dozen Eddie Stobart lorries. Over the past ten years, the target has been to add at least 20 models (primarily cars) to the Collection. This has been exceeded each year without exception, with an average increase of 22 models per year. The major year of growth was in 2006, when 47 models were added. The most notable events since 2006 were the diversifications into the train and aeroplane sectors. There are some opportunities to dramatically increase the size of the train collection from three models over the next year, and the merits are currently being explored. However, no expansion of the aeroplane division is expected for the foreseeable future. A fifth division, that of model buses, has just been set up last month, but is likely to remain with just one model for the long term.

The past year has seen modest and steady growth, with the added benefit of The Royal Wedding, which added further to the Collection. The biggest milestone was reached at Christmas, when the number of MINI Coopers surpassed 300 models. As at 31 January 2012, there were 302 MINI Cooper Models, 28 Eddie Stobart models, three trains and 11 model aeroplanes, leaving a total collection of 427 models, an increase of just one model over the course of the year, due to re-classifications of less valuable items and disposals of duplications. Once again, there are now no duplications in the Collection. This compares to 289 MINI Models, 26 Eddie Stobart models, two trains and 11 planes on 31 January 2011. There was therefore an increase of 13 MINI Cooper Models, two Eddie Stobart models and one train, following the purchase of a Harry Potter train actually purchased in 2010 finally being integrated into the Collection. There was no change in the size of the Collection from 31 January to 27 March other than the addition of one model bus. However, due to a number of events this year, such as the Olympic Games and the Paralympic Games, the pace of increase is likely to accelerate in the coming year.

The Listed Investments comprising of the International Consolidated Airlines Group, SA “IAG” and the Stobart Group Ltd “Stobart” continued to change in value.

As at the close of trade on Friday 30 January 2012, the value of an IAG ordinary share was 177.90p, leading to a total value of 200 ordinary shares of £355.80. This compares with an ordinary share price of 261.00p at the close of trade on Friday 28 January 2011, which valued 200 ordinary shares at £522. The value of the stake in IAG has therefore fallen by £166.20, or 31.8%. Despite this sharp valuation drop, as the share purchase was exclusively for customer discount reasons, there is not expected to be any open market sale at any price, and the holding is expected to be retained for the foreseeable future unless there is a minority squeeze out due to an unwanted hostile takeover bid (such as by a private equity firm or a Middle-Eastern competitor). Therefore, the valuation of shares in this company has no material impact on the value of the Collection. The IAG share price was impacted in the prior year by the merger between British Airways and Iberia.

As at the close of trade on Friday 30 January 2012, the value of a Stobart ordinary share was 128.00p, valuing 100 ordinary shares at £128. As at the close of trade on Friday 28 January 2011, the value of a Stobart ordinary share was 145.00p, valuing 100 ordinary shares at £145. This represents a fall of £17 which equates to an 11.72% decline over the past year. This shareholding continues to be a long term investment. There have been a number of successful developments at Stobart over the past year, most notably the successful redevelopment of London Southend Airport and the continuation of the Channel 5 documentary series “Eddie Stobart: Trucks & Trailers”. However, this has been more than offset by the continued delay in the proposed redevelopment of Carlisle Lake District Airport and the re-purchase of the Moneypenny Property Portfolio from W A Developments Holdings Ltd.

As has been well publicised by the financial press, both of the above companies are interested in certain separate assets of British Midland Airways Ltd and an outcome is awaited in the near future.

Due to the major sporting events later this year, I anticipate another good year of growth in prospect.

Marc Bannister

27/03/12

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