TIDMAVAP
RNS Number : 0300D
Avation PLC
23 October 2020
AVATION PLC
("Avation" or "the Company")
UNAUDITED Financial Results for the YEar ended 30 june 2020
and Interim Management Statement
Avation PLC (LSE: AVAP), the commercial passenger aircraft
leasing company, announces preliminary unaudited financial results
for the year ended 30 June 2020.
Key Financial Results
-- Revenue increased 14% to a record $135.3 million;
-- Unrealised gain on aircraft purchase rights of $27.1 million recognised;
-- Cash and bank balances increased 7% to $114.6 million;
-- Impairment losses of $35.5 million recognised, reflecting the
COVID-19 pandemic, industry and customer disruption;
-- Profit before taxation decreased 43% to $14.6 million, in challenging conditions; and
-- Net cash from operating activities increased 20% to $88.5 million.
Operational Highlights
-- Two aircraft were repossessed from Thomas Cook and transitioned to VietJet;
-- Three new ATR72-600 aircraft were acquired during the year;
-- Three Fokker 100 aircraft were transferred to the lessee on completion of finance leases;
-- First ever commercial aircraft financed with a Green loan -
recognised by Airline Economics as "Deal of the Year for
Innovation"; and
-- Ongoing management of exposure to Virgin Australia
administration with transition of five of 13 aircraft on lease to
date.
COVID-19 Strategy
-- The Company has implemented a strategy to preserve liquidity and cashflow;
-- Short-term rent deferrals totalling approximately $13.1 million granted to airline customers;
-- Loan repayment deferrals totalling approximately $24.4
million obtained from secured lenders; and
-- The Company has elected to temporarily pause capital expenditure and dividends.
Executive Chairman, Jeff Chatfield, said:
"Avation has posted a satisfactory result in a volatile
environment. Avation is profitable in a challenging time for both
the airline and aircraft leasing sector.
"At the outset of the COVID-19 pandemic Avation instituted a
programme of support for its airline customers by agreeing to defer
payment of a portion of their rent in the short-term. The cashflow
impact of this support programme has been mitigated by adjusting
the amortisation profiles of related financings with the agreement
of lenders. Since the start of the pandemic the Company has also
reduced administration costs and has instituted a temporary pause
on capital expenditure with the goal of preserving liquidity.
"The Company believes that airlines will require significant
number of leased aircraft in the post pandemic phase due to the
vast number of older aircraft that have been retired and the impact
of the pandemic on airline balance sheets, reducing their ability
to purchase aircraft directly. This supports the Company strategy
of being focussed on relatively new and popular commercial aircraft
types.
"The Company is fortunate that some of its largest customers are
in countries where there has been a brief or manageable impact from
the pandemic. We are now observing a return to service of certain
customers including VietJet, airBaltic, EVA Air and Mandarin
Airlines which combined represent of the order of 60% of Avation's
future unearned contracted leasing revenue.
"Avation is optimistic about the long-term opportunity for
airline travel particularly the turboprop and narrow-body aircraft
sectors. The Company will position itself for a return to growth
through opportunistic purchases and delivery of its orderbook in a
post pandemic environment "
Financial Highlights and Analysis
30 June 30 June
2020 2019 Change
US$ 000's US$ 000's
Revenue 135,274 119,055 14%
Depreciation (46,666) (41,011) 14%
Administrative expenses (11,913) (10,954) 9%
%
Other income and expenses, net (1,150) 49
--------------------------------------------- ----------- -----------
Operating profit excluding Unrealised gain
on purchase rights, Gains on disposal and
Impairment loss on aircraft 75,545 67,139 13%
Finance income and expenses, net (55,721) (51,606) 8%
--------------------------------------------- ----------- -----------
Profit before tax excluding Unrealised gain
on purchase rights, Gains on disposal of
aircraft and Impairment loss on aircraft 19,824 15,533 28%
Unrealised gain on aircraft purchase rights 27,110 -
Gains on disposal of aircraft 3,230 10,026
Impairment loss on aircraft (35,524) -
--------------------------------------------- ----------- -----------
Profit before taxation 14,640 25,559 (43%)
Taxation (4,924) 132
--------------------------------------------- ----------- -----------
Profit after tax 9,716 25,691 (62%)
EPS 15.4 cents 40.3 cents (62%)
Dividend per share 10.6 cents 9.25 cents 15%
Fleet assets (1) 1,242,176 1,269,682 (2%)
Total assets 1,415,584 1,392,750 2%
Cash and bank balances 114,585 107,448 7%
Net asset value per share (US$) (2) $3.53 $3.74 (6%)
Net asset value per share (GBP) (3) GBP2.86 GBP2.95 (3%)
1. Fleet assets are defined as property, plant and equipment
plus assets held for sale plus finance lease receivables.
2. Net asset value per share is total equity divided by the
total number of shares in issue, excluding treasury shares, at
period end.
3. Based on GBP:USD exchange rate as at 30 June 2020 of 1.23 (30 June 2019 : 1.27)
Aircraft Fleet
Aircraft Type 30 June 2020
Boeing 777-300ER 1
Airbus A330-300 1
Airbus A321-200 7
Airbus A320-200 2
Boeing 737-800 1
Airbus A220-300 6
Fokker 100 2
ATR 72-600 22
ATR 72-500 6
-------------
Total 48
At June 30, Avation's fleet comprised 48 aircraft, including
seven aircraft on finance lease. The weighted average age of the
fleet is 4.1 years (2019: 3.4 years) and the weighted average
remaining lease term is 6.9 years (2019: 7.5 years).
Fleet assets decreased 2% to $1,242.2 million (2019: $1,269.7
million). Three ATR72-600 aircraft were added to the fleet in the
period. Three Fokker 100 aircraft were transferred to the lessee
airline upon completion of their finance leases. Narrowbody
aircraft make up 47.5% of the fleet as at 30 June 2020.
Avation has orders for eight additional ATR 72-600 aircraft and
has purchase rights for a further 25 aircraft.
Airline Customers in Administration (update as of 23 October
2020)
Avation had two airline customers (Virgin Australia and
Braathens) subject to insolvency administrations as of the end of
the reporting period.
Virgin Australia
Avation had a total of 13 aircraft on lease to Virgin Australia
when it entered administration. These included six ATR72-500
aircraft, five ATR72-600 aircraft and two Fokker 100 jet aircraft.
Since the commencement of administration, Avation has entered into
new lease arrangements for five of these aircraft, including
finance leases for the sale of the two Fokker 100 aircraft,
operating leases for two ATR72-500s with a new airline customer in
Australia and a five year operating lease for an ATR72-500 aircraft
with a new airline customer in Asia.
The three remaining ATR72-500s have been returned to Avation and
are now undergoing maintenance in preparation for re-marketing for
lease or sale. The Administrator has also commenced the return of
the five ATR72-600 aircraft. Avation is now seeking to reposition
or sell a total of eight ATR72 aircraft. The total secured debt
outstanding against these eight aircraft amounts to US$30.7
million.
The majority of the Company's claim against Virgin Australia
consists of outstanding rent and end-of-lease return maintenance
compensation. Avation's preliminary proof of debt claim against
Virgin Australia amounts to US$74.7 million. On 25 August 2020, the
Administrator released a report to creditors which provided
guidance that the estimated return to unsecured creditors will be
9%-13% of the amount owed with payment expected prior to 30 June
2021.
Braathens
Avation had two ATR72-600 aircraft on lease to Braathens when it
entered administration. The airline has now successfully exited
administration and restarted operations. Avation has agreed new
lease terms with the airline including extensions in lease duration
from 10 to 12 years. The Company has also negotiated adjustments to
the amortisation profiles of the related financings with the senior
lender to reflect the revised lease terms. Avation is optimistic of
maintaining a profitable customer relationship with Braathens in
the event that airline is able to maintain the current lease
terms.
Recognition of Purchase Rights
The Company holds Purchase Rights to acquire 25 additional
aircraft under its contract with ATR. In December 2019, the Company
changed its business model for Purchase Rights by recognising that
it holds excess Purchase Rights over and above the Company's
requirement to acquire additional ATR aircraft for its fleet. The
Company will seek to dispose of excess Purchase Rights from time to
time when market conditions are favourable. In recognition of this
change in business model, the Company recognised the Purchase
Rights at fair value through profit or loss in the financial
statements.
Purchase Rights for 25 ATR72-600 aircraft, represent a material
source of growth for Avation and potential value for shareholders.
Fair values for Purchase Rights were determined by the Company
based on an independent third-party valuation of the aircraft
delivery positions. The recognition of this asset on the balance
sheet has generated an unrealised gain of $27.1 million. Purchase
Rights are subject to revaluation through profit or loss at each
future balance sheet date.
Debt summary
30 June 2020 30 June 2019
US$000's US$000's
Loans and borrowings 1,071,738 1,078,288
Unrestricted cash and bank
balances 35,290 61,689
Net indebtedness (1) 1,036,448 1,016,599
Debt to assets (2) 75.7% 77.4%
Weighted average cost of secured
debt (3) 3.6% 3.7%
Weighted average cost of total
debt (4) 4.5% 4.6%
1. Net indebtedness is defined as loans and borrowings less unrestricted cash and bank balances.
2. Debt to assets is defined as total debt divided by total assets.
3. Weighted average cost of secured debt is the weighted average
interest rate for secured loans and borrowings at period end.
4. Weighted average cost of total debt is the weighted average
interest rate for total loans and borrowings at period end.
The weighted average cost of total debt decreased to 4.5% as at
30 June 2020 (2019: 4.6%). The weighted average cost of secured
debt decreased to 3.6% at 30 June 2020 (2019: 3.7%).
At the end of the year, Avation's debt to assets ratio was 75.7%
(2019: 77.4%). At 30 June 2020, 90.7% of total debt was at fixed or
hedged interest rates (2019: 92.0%). The proportion of unsecured
debt to total debt was 32.3% (2019: 32.0%).
Avation will continue to source secured and unsecured debt
finance to fund fleet growth with the overriding objective of
lowering its weighted average cost of finance.
Avation is currently reviewing alternatives in relation to the
Avation Capital S.A. 6.5% senior notes due 2021 issued under
Avation's global medium-term note programme and has retained
specialist financial advisers, PJT Partners, to assist with this
process.
Dividend
The Board declared an interim dividend of 2.1 US cents per share
in respect of the six months ended 31 December 2019, which was paid
9 January 2020.
A dividend of 8.5 US cents per share declared in respect of the
financial year ended 30 June 2019 was paid on 18 October 2019.
The Company advised in May 2020 that as part of the COVID-19
strategy to preserve liquidity there would be no further dividends
for this financial period.
Market Positioning
Avation's strategy is to target growth and diversification by
adding new airline customers, while maintaining a low average
aircraft age and long remaining lease term metrics. Avation focuses
on new and relatively new commercial passenger aircraft on
long-term leases. Avation is capable of owning, managing and
leasing turboprop, narrowbody and twin-aisle aircraft and
engines.
The Company's business model involves rigorous investment
criteria and has a history of delivering consistent profitability
while seeking to mitigate the risks associated with the aircraft
leasing sector. Avation will typically sell mid-life and older
aircraft and redeploy capital to newer assets. This approach is
intended to mitigate technology change risk, operational and
financial risk, support sustained growth and deliver long-term
shareholder value.
Avation is an active trader of aircraft and from time to time
will consider the acquisition or sale of individual or smaller
portfolios of aircraft, based on prevailing market opportunities
and consideration of risk and revenue concentrations.
Engine Leasing
In January 2020 Avation completed the purchase of a Pratt &
Whitney PW127M aircraft engine. This acquisition represents
Avation's first investment in an individual engine for leasing.
Avation entered into a short-term lease of this engine. Airlines
require access to spare engines to ensure continuous operation of
aircraft. This new business line is synergistic to Avation's core
aircraft leasing business.
Interim Management Statement
The Company's continuing focus for the 2021 financial year is to
preserve liquidity and maintain cashflow while the pandemic
persists and the airline industry is severely impacted.
Management believes that the risks associated with its portfolio
of assets have been reduced through the growth and diversification
that has been achieved in recent years.
In addition to operational cash flows, funding is traditionally
sourced from capital markets, asset-backed bank lending and
disposal of selected aircraft. Access to acceptably priced funding
is a risk, which is common to all capital-intensive businesses.
Specific risks which are inherent to the aircraft leasing industry
include, but are not limited to, ongoing pandemic impacts on
travel, the creditworthiness of airline customers, over-production
of new aircraft and market saturation, technology change, residual
value risks, competition from other lessors and the risk of
impairment of aircraft assets.
Results Conference Call
Avation's senior management team will host a conference call on
23 October 2020, at 1pm BST (UK) / 8am EST (US) / 8pm SGT
(Singapore), to discuss the Company's financial results. Investors
can participate in the conference call by using the following
link:
https://avation.emincote.com/avapFY2020/vip_connect
You will need to register your name and email address. You will
receive a telephone number, a passcode and an individual PIN
number. The conference call will also be webcast live through the
following link:
https://avation.emincote.com/avapFY2020
To view the webcast, you will need to register your name and
email address . A replay of the broadcast will be available on the
Investor Relations page of the Avation Plc website.
Annual General Meeting
The annual general meeting of the Company is expected to be held
at the Company's headquarters in Singapore on 8 December 2020 at
9am GMT (UK) / 5pm SGT (Singapore). Notice of the annual general
meeting will be issued in due course.
Forward Looking Statements
This release contains certain "forward looking statements".
Forward looking statements may be identified by words such as
"expects," "intends," "initiate", "anticipates," "plans,"
"believes," "seeks," "estimates," "will, " or words of similar
meaning and include, but are not limited to, statements regarding
the outlook for Avation's future business and financial
performance. Forward looking statements are based on management's
current expectations and assumptions, which are subject to inherent
uncertainties, risks and changes in circumstances that are
difficult to predict. Actual outcomes and results may differ
materially due to global political, economic, business,
competitive, market, regulatory and other factors and risks.
Further information on the factors and risks that may affect
Avation's business is included in Avation's regulatory
announcements from time to time, including its Annual Report, Full
Year Financial Results and Half Year Results announcements. Avation
expressly disclaims any obligation to update or revise any of these
forward-looking statements, whether because of future events, new
information, a change in its views or expectations, or
otherwise.
Basis of presentation
This announcement covers the unaudited results of Avation PLC
for the year ended 30 June 2020.
Financial information presented in this announcement is being
published for the purposes of providing preliminary Group financial
results for the year ended 30 June 2020. The financial information
in this preliminary announcement is not audited and does not
constitute statutory financial statements of Avation PLC within the
meaning of section 434 of the Companies Act 2006. The Group
statutory financial statements for the year ended 30 June 2020 are
expected to be delivered to the Registrar of Companies by 31
October 2020. (as at the date of this report, such statutory
financial statements have not been reported on by the independent
auditors of the Company). However, the independent auditors have
indicated that the audit opinion on such statutory financial
statements will be an unqualified opinion with a material
uncertainty related to going concern. Such financial statements
will include a disclosure by the Directors of the Company that
there is a material uncertainty relating to the Directors'
intention to obtain an extension to the 6.5% senior notes due 2021.
The Board of Directors approved this financial information on 22
October 2020. Avation PLC's most recent statutory financial
statements for the purposes of Chapter 7 of Part 15 of the
Companies Act 2006 for the year ended 30 June 2019, upon which the
auditors have given an unqualified audit report, were published on
27 September 2019 and have been annexed to the annual return and
delivered to the Registrar of Companies.
All "$" amounts in this release are US Dollar amounts unless
stated otherwise. Certain comparative amounts have been
reclassified to conform with current year presentation.
-S-
More information on Avation PLC can be found at: www.avation.net
. Avation welcomes shareholder questions and comments and advises
the email address is: investor @avation.net
Enquiries:
Avation PLC T: +65 6252 2077
Jeff Chatfield, Executive Chairman
AVATION PLC
CONSOLIDATED STATEMENT OF PROFIT OR LOSS
FOR THE FINANCIAL YEARED 30 JUNE 2020
2020 2019
US$'000s US$'000s
Continuing operations
Revenue 135,274 119,055
Other income 1,270 215
136,544 119,270
Depreciation (46,666) (41,011)
Gain on disposal of aircraft 3,230 10,026
Unrealised gain on aircraft purchase rights 27,110 -
Impairment loss on aircraft (35,524) -
Administrative expenses (11,913) (10,954)
Other expenses (2,420) (166)
Operating profit 70,361 77,165
Finance income 1,471 3,722
Finance expenses (57,192) (55,328)
Profit before taxation 14,640 25,559
Taxation (4,924) 132
Profit from continuing operations 9,716 25,691
------------ ------------
Profit attributable to:
Equity holders of the Company 9,714 25,690
Non-controlling interests 2 1
9,716 25,691
------------ ------------
Earnings per share for profit
attributable to equity holders of the Company
Basic earnings per share: 15.39 cents 40.26 cents
Diluted earnings per share 15.36 cents 40.10 cents
------------ ------------
AVATION PLC
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE FINANCIAL YEARED 30 JUNE 2020
2020 2019
US$'000s US$'000s
Profit from continuing operations 9,716 25,691
--------- ---------
Other comprehensive income:
Items that may be reclassified subsequently to profit or loss:
Net loss on cash flow hedge, net of tax (12,947) (18,009)
(12,947) (18,009)
Items that may not be reclassified subsequently to profit or loss:
Revaluation (loss)/gain on property, plant and equipment, net of tax (4,230) 8,181
--------- ---------
Other comprehensive income, net of tax (17,177) (9,828)
Total comprehensive income for the year (7,461) 15,863
--------- ---------
Total comprehensive income attributable to:
Equity holders of the Company (7,463) 15,862
Non-controlling interests 2 1
--------- ---------
(7,461) 15,863
--------- ---------
AVATION PLC
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
FOR THE FINANCIAL YEARED 30 JUNE 2020
2020 2019
US$'000s US$'000s
ASSETS
Non-current assets
Property, plant and equipment 1,057,901 1,225,324
Trade and other receivables 11,601 8,930
Finance lease receivables 85,019 37,137
Goodwill 1,902 1,902
Derivative financial assets - 363
Aircraft purchase rights 27,110 -
---------- ----------
1,183,533 1,273,656
Current assets
Trade and other receivables 18,210 4,425
Finance lease receivables 7,988 7,221
Cash and bank balances 114,585 107,448
---------- ----------
140,783 119,094
Assets held for sale 91,268 -
---------- ----------
232,051 119,094
---------- ----------
Total assets 1,415,584 1,392,750
---------- ----------
EQUITY AND LIABILITIES
Equity
Share capital 1,108 1,104
Share premium 57,747 56,912
Treasury shares (7,811) (1,147)
Merger reserve 6,715 6,715
Asset revaluation reserve 30,162 34,392
Capital reserve 8,876 8,876
Other reserves (24,302) (11,809)
Retained earnings 148,455 145,644
---------- ----------
Equity attributable to equity holders of the parent 220,950 240,687
Non-controlling interests 72 70
---------- ----------
Total equity 221,022 240,757
---------- ----------
Non-current liabilities
Loans and borrowings 534,755 1,005,693
Trade and other payables 11,725 16,091
Derivative financial liabilities 27,928 10,174
Maintenance reserves 57,141 31,325
Deferred tax liabilities 698 179
---------- ----------
632,247 1,063,462
Current liabilities
Loans and borrowings 536,983 72,595
Trade and other payables 10,155 11,964
Maintenance reserves 3,836 1,166
Income tax payables 1,058 2,806
---------- ----------
552,032 88,531
Liabilities directly associated with assets held for sale 10,283 -
---------- ----------
562,315 88,531
Total equity and liabilities 1,415,584 1,392,750
---------- ----------
AVATION PLC
CONSOLIDATED STATEMENT OF EQUITY CHANGES
FOR THE FINANCIAL YEARED 30 JUNE 2020
Attributable to shareholders of the parent
Share Share Treasury Merger Asset Capital Other Retained Total Non-controlling Total
capital premium Shares reserve revaluation reserve reserves earnings interest equity
reserve
US$'000s US$'000s US$'000s US$'000s US$'000s US$'000s US$'000s US$'000s US$'000s US$'000s US$'000s
Balance at 1 July
2019 1,104 56,912 (1,147) 6,715 34,392 8,876 (11,809) 145,644 240,687 70 240,757
Effect of adoption
of IFRS 16 Leases - - - - - - (199) (199) - (199)
--------- --------- ---------- --------- ------------ --------- --------- ---------- ----------- ---------------- ---------------
As at 1 July 2019
(adjusted) 1,104 56,912 (1,147) 6,715 34,392 8,876 (11,809) 145,445 240,488 70 240,558
--------- --------- ---------- --------- ------------ --------- --------- ---------- ----------- ---------------- ---------------
Profit for the
period - - - - - - - 9,714 9,714 2 9,716
Other comprehensive
income - - - - (4,230) - (12,947) - (17,177) - (17,177)
--------- --------- ---------- --------- ------------ --------- --------- ---------- ----------- ---------------- ---------------
Total comprehensive
income - - - - (4,230) - (12,947) 9,714 (7,463) 2 (7,461)
--------- --------- ---------- --------- ------------ --------- --------- ---------- ----------- ---------------- ---------------
Dividends paid - - - - - - - (6,773) (6,773) - (6,773)
Issue of new shares 4 835 - - - - (69) - 770 - 770
Purchase of
treasury
shares - - (6,664) - - - - - (6,664) - (6,664)
Share warrant
expense - - - - - - 592 - 592 - 592
--------- --------- ---------- --------- ------------ --------- --------- ---------- ----------- ---------------- ---------------
Total transactions
with owners
recognised
directly in equity 4 835 (6,664) - - - 523 (6,773) (12,075) - (12,075)
--------- --------- ---------- --------- ------------ --------- --------- ---------- ----------- ---------------- ---------------
Expiry of share
warrants - - - - - - (69) 69 - - -
--------- --------- ---------- --------- ------------ --------- --------- ---------- ----------- ---------------- ---------------
Total others - - - - - - (69) 69 - - -
--------- --------- ---------- --------- ------------ --------- --------- ---------- ----------- ---------------- ---------------
Balance at 30
June 2020 1,108 57,747 (7,811) 6,715 30,162 8,876 (24,302) 148,455 220,950 72 221,022
--------- --------- ---------- --------- ------------ --------- --------- ---------- ----------- ---------------- ---------------
AVATION PLC
CONSOLIDATED STATEMENT OF EQUITY CHANGES
FOR THE FINANCIAL YEARED 30 JUNE 2019
Attributable to shareholders of the parent
Share Share Treasury Merger Asset Capital Other Retained Total Non-controlling Total
capital premium shares reserve revaluation reserve reserves earnings interest equity
reserve
US$'000s US$'000s US$'000s US$'000s US$'000s US$'000s US$'000s US$'000s US$'000s US$'000s US$'000s
Balance at 1
July
2018 1,080 53,083 - 6,715 27,847 8,876 6,389 124,119 228,109 69 228,178
Profit for the
year - - - - - - - 25,690 25,690 1 25,691
Other
comprehensive
income - - - - 8,181 - (18,009) - (9,828) - (9,828)
--------- --------- ---------- --------- ------------ --------- --------- ---------- ---------- ---------------- ----------
Total
comprehensive
income - - - - 8,181 - (18,009) 25,690 15,862 1 15,863
--------- --------- ---------- --------- ------------ --------- --------- ---------- ---------- ---------------- ----------
Dividend paid - - - - - - - (5,840) (5,840) - (5,840)
Issue of new
shares 24 3,829 - - - - (628) - 3,225 - 3,225
Purchase of
treasury
shares - - (1,147) - - - - - (1,147) - (1,147)
Share warrants
expense - - - - - - 478 - 478 - 478
--------- --------- ---------- --------- ------------ --------- --------- ---------- ---------- ---------------- ----------
Total
transactions
with owners
recognised
directly in
equity 24 3,829 (1,147) - - - (150) (5,840) (3,284) - (3,284)
--------- --------- ---------- --------- ------------ --------- --------- ---------- ---------- ---------------- ----------
Expiry of share
warrants - - - - - - (39) 39 - - -
Release of
revaluation
reserve upon
sale
of aircraft - - - - (1,636) - - 1,636 - - -
--------- --------- ---------- --------- ------------ --------- --------- ---------- ---------- ---------------- ----------
Total others - - - - (1,636) - (39) 1,675 - - -
--------- --------- ---------- --------- ------------ --------- --------- ---------- ---------- ---------------- ----------
Balance at 30
June 2019 1,104 56,912 (1,147) 6,715 34,392 8,876 (11,809) 145,644 240,687 70 240,757
--------- --------- ---------- --------- ------------ --------- --------- ---------- ---------- ---------------- ----------
AVATION PLC
CONSOLIDATED STATEMENT OF CASHFLOWS
FOR THE FINANCIAL YEARED 30 JUNE 2020
2020 2019
US$'000s US$'000s
Cash flows from operating activities:
Profit before income tax 14,640 25,559
Adjustments for:
Amortisation of lease incentive asset 524 -
Depreciation expense 46,666 41,011
Depreciation of right-of-use assets 217 -
Expected credit loss on receivables and accrued revenue 855 166
Finance income (1,471) (3,722)
Finance expense 57,192 55,328
Gain on disposal of aircraft (3,230) (10,026)
Interest income from finance lease (3,266) (1,382)
Impairment loss on aircraft 35,524 -
Share warrants expense 592 478
Unrealised gain on aircraft purchase rights (27,110) -
Operating cash flows before working capital changes 121,133 107,412
Movement in working capital:
Trade and other receivables and finance lease receivables (5,105) 4,411
Trade and other payables (5,551) 1,412
Maintenance reserves 28,621 8,947
--------- ----------
Cash from operations 139,098 122,182
Finance income received 3,215 2,950
Finance expense paid (51,712) (48,579)
Income tax paid (2,095) (2,946)
--------- ----------
Net cash from operating activities 88,506 73,607
--------- ----------
Cash flows from investing activities:
Purchase of property, plant and equipment (58,739) (328,570)
Proceeds from disposal of aircraft - 70,184
Net cash used in investing activities (58,739) (258,386)
--------- ----------
Cash flows from financing activities:
Net proceeds from issuance of ordinary shares 770 3,225
Dividends paid to shareholders (6,773) (5,840)
Purchase of treasury shares (6,664) (1,147)
Placement of restricted cash balances (33,536) (12,607)
Proceeds from loans and borrowings, net of transactions costs 76,561 301,741
Repayment of loans and borrowings (86,524) (96,854)
--------- ----------
Net cash (used in)/from financing activities (56,166) 188,518
--------- ----------
Net (decrease)/increase in cash and cash equivalents (26,399) 3,739
Cash and cash equivalents at beginning of year 61,689 57,950
--------- ----------
Cash and cash equivalents at end of year 35,290 61,689
--------- ----------
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