Shares in Avation PLC (LON:AVAP) were flying high early on Thursday morning after the aircraft leasing group posted another record-breaking full-year results.
A higher lease yield helped to push up revenues by almost a third to US$94.2mln (2016: US$71.2mln) during the 12 months ended 30 June, while pre-tax profits jumped by 18% to US$21.4mln.
That allowed Avation to increase its dividend by 85% to 6 US cents (2016: 3.25 cents).
As an “active trader” of planes, the company re-jigged its portfolio a couple of times last year. It added four new Airbus A321s which are currently on lease to VietJet, while it disposed of three other A321s.
Avation also sold off six of its ATR 72 turboprops for above book value, netting it a cool US$31mln.
Ready to add to its fleet
The company has repeatedly said it will dip into its cash reserves – which stood at US$87.7mln at the end of June (2016: US$48.3mln) – to add to its fleet and it is in the assessing a “number of aircraft” for potential acquisition.
“Avation is pleased to report record revenue, profit and operating cashflow in the year to 30 June 2017 [and] continues to diversify its aircraft fleet while adding balance sheet scale,” said executive chairman Jeff Chatfield.
“Fleet metrics have improved with lease yield rising to 12.8%, while the average age of the fleet has reduced and the average remaining lease term for the aircraft portfolio has increased.
“The company has ended the year with a substantial cash balance, lower leverage and has an improved credit rating, which are features that support the funding of further fleet expansion.”
Good start to second half
On top of the strong financial performance, Avation said it had positioned itself well for the future by both reducing the average age of its aircraft and increasing the average lease term during the year.
In fact it has rolled over its fine form into the current year, telling investors that fleet and lease revenues continue to grow year-on-year.
Shares rose 3.4% to 242.9p in early deals on Thursday.