UK's Avation full-year operating profit jumps 38%, returns to profit

Overview

• UK aircraft lessor's preliminary full-yr revenue was flat, with net income returning to profit

• Operating profit rose 38% yr/yr, helped by aircraft sale gains and lower unrealised losses

• Company raised interim dividend 50% and cut net indebtedness by 13.3% yr/yr

Outlook

• Avation plans to focus on placing ATR 72-600 orderbook and expanding its customer base

• Company expects gradual transition to newer, fuel-efficient aircraft and ongoing fleet growth

Result Drivers

• AIRCRAFT SALES AND LEASE TRANSITIONS - Co said sale of Boeing 777-300ER and early lease terminations reduced lease rental revenue, but gains on disposal and end-of-lease compensation offset some impact

• REDUCED UNREALISED LOSSES - Co said operating profit was helped by lower unrealised losses on aircraft purchase rights and pre-delivery deposits

• REVERSAL OF IMPAIRMENT LOSSES - Co said reversal of previously recognised impairment losses on aircraft contributed to profit, reflecting firmer residual values

Company press release:

Key Details

Analyst Coverage

• The one available analyst rating on the shares is "buy"

• The stock recently traded at 13 times the next 12-month earnings vs. a P/E of 12 three months ago

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)