Commercial aircraft leasing group Avation PLC (LON:AVAP) bumped up the dividend by more than a fifth after a solid year.
The dividend per share was cranked up to 7.25 cents from 6 cents the year before after a year in which the group reduced the risks associated with its portfolio of aircraft. Five new aircraft were added to the fleet during the year, including three new aircraft types.
READ: Avation adds another aircraft to leased fleet
"Avation was successful at redeploying the proceeds generated by sales of aircraft in the previous financial year, adding new aircraft and customers to further grow the fleet and diversify the revenue base. This included investments in twin-aisle Boeing 777-300ER and Airbus A330-300 aircraft alongside new technology narrow-body Airbus A220-300 aircraft,” commented Jeff Chatfield, the executive chairman of Avation.
Revenue in the year to the end of June rose 16% to US$109.1mln from US$94.2mln but thanks to paper-based gains and losses of aircraft sales in the reporting period and the year before, the profit before tax declined to US$18.92mln from US$21.36mln. The net asset value per share increased over the year by 12% to US$3.64.
"The performance of Avation showed growth consistent with an increase in fleet assets and record high monthly lease rental collections as at 30 June 2018. The leasing business delivered the highest revenue and profit in the history of the Company when excluding one-off gains from trading,” Chatfield revealed.
"Fleet metrics improved with the average age of the fleet reduced to 3.2 years and the average remaining lease term increased to 7.7 years as at 30 June 2018 with no operating leases expiring until 2021.
"Added scale and diversification delivered credit enhancement that saw credit rating upgrades from both S&P and Fitch Ratings and also allowed the issuance of $300 million 6.5% Senior Notes due 2021, which extended debt maturity duration and lowered Avation's average cost of debt compared to the previous financial year,” Chatfield said.
READ: Avation credit rating outlook revised to positive by Standard & Poor's
Looking ahead, Chatfield said Avation will continue to focus on growing the fleet and adding new airline customers.
“The company is currently assessing jet aircraft for acquisition, in addition to the scheduled deliveries of new ATR 72 turboprop aircraft from our order book," Chatfield said.