Avation Plc · LSE:AVAP
Avation — H1 FY2018 Earnings Presentation
17 slides from Avation's earnings presentation, Feb 26, 2018
Slide 1: Financial Year 2018 – First Half Investor Update
LSE: AVAP Financial Year 2018 – First Half Investor Update 26 February 2018 Presented by: Jeff Chatfield Richard Wolanski Robert Heese Iain Cawte Duncan Scott Executive Chairman Finance Director Chief Financial Officer Treasury & Risk General Counsel
Slide 2: Important Notice
Important Notice Some of the statements in this presentation constitute “forward-looking statements” that do not directly or exclusively relate to historical facts. These forward-looking statements reflect the Company’s current intentions, plans, expectations, assumptions and beliefs about future ev
Slide 3: Snapshot of Avation as at December 2017
Snapshot of Avation as at 31 December 2017 Full Leasing Platform with Diversified Customer Base and Aircraft 12 Airline 24/43/33 2.9 Years 37 Customers Operating split of Aircraft widebody/narrowbody/ Weighted Average in 9 Countries regional aircraft by value Aircraft Age(1) 2.9Y 7.9 Years US$1Billi
Slide 4: Financial Year 2018 – First Half Summary
Financial Year 2018 – First Half Summary Revenue Lease Revenue US$52.4 million US$41.7 million +16% YoY (8%) YoY Operating Profit (EBIT) Total Profit after Tax US$25.1 million US$6.7 million (9%) YoY (8%) YoY Fleet Assets (1) Earnings per Share US$1,008 million US 10.9 cents +35% since FY2017 (15%)
Slide 5: Operational Highlights
Operational Highlights Growth, Fleet Diversification and Renewal • Record growth with four aircraft added in Dec 17 (>US$286 million) • Annualized lease rental run rate >US$115 million • Airbus A320 transitioned from Air Berlin to easyJet in Dec 17 • First twin aisle aircraft delivered into the flee
Slide 6: Aircraft Leasing Business Objectives
Aircraft Leasing Business Objectives Strong Diversify Fleet revenue Metrics Increase Profit Scale & Control Growth Costs 6
Slide 7: Attractive Industry Fundamentals
Attractive Industry Fundamentals Resilient Airline Traffic Growth Demand for air travel, and aircraft, has been growing through economic cycles (RPK(1) Tr) Asian WTC Financial Oil Crisis Oil Crisis Gulf Crisis Crisis Attack SARS Crisis 7.0 6.0 5.0 +60% 4.0 +110% 3.0 2.0 1.0 0.0 1970 1975 1980 1985 1
Slide 8: Attractive Fleet Portfolio as at December 2017
Attractive Fleet Portfolio as at 31 December 2017 Balanced Portfolio of Young Aircraft Balanced Fleet with Orderbook and Options to Retain Expansion Flexibility Aircraft Type Fleet Orders Options Regional Aircraft ATR 72-600 13 6 30 ATR 72-500 6 - - Narrowbody Aircraft A321-200 8 - - A320-200 3 - -
Slide 9: Fleet Metrics
Fleet Metrics FY 2015 FY 2016 FY 2017 HY 2018 Young fleet, Fleet 29 38 35 37 reducing risk of technology Fleet additions (net) 4 9 (3) 2 obsolescence Weighted average aircraft age 5.3 years 4.2 years 3.3 years 2.9 years(1) Visibility of cash flows due to Weighted average remaining lease term 6.5 yea
Slide 10: 12 Airline Customers from 9 Countries
Established Customer Relationships with Favorable Contracts Global Customer Relationships 12 Airline Customers from 9 Countries 10
Slide 11: Established Customer Relationships with Favorable Contracts (Cont’d)
Established Customer Relationships with Favorable Contracts (Cont’d) …with Increasing Scale & Customer Diversification By Revenue EasyJet 2% Condor Air Pacific Air France 3% 2% 3% Fiji Airways Mandarin 4% Quick Duck 2% 4% Air India Regional 4% Air India Regional UNI Airways 4% 5% Virgin Australia Co
Slide 12: Fleet Growth
Fleet Growth Fleet assets (US$m) 1,200 1,000 800 600 400 200 0 2011 2012 2013 2014 2015 2016 2017 HY2018 12
Slide 13: Profit & Loss Summary
Profit & Loss Summary Profit & Loss Summary (US$ million) HY2018 HY2017 Growth Total revenue and Other income 52.6 45.6 16% Depreciation expense (14.6) (15.9) (9%) Gains on sale (net of impairment) (8.0) 2.0 Administrative expense (4.9) (3.9) 25% Operating Profit/EBIT 25.1 27.6 (9%) Finance expenses
Slide 14: Debt Analysis
Debt Analysis HY2018 FY2017 Net Indebtedness (US$ million) 779.6 555.9 Weighted Average Cost of Debt 4.8% 5.1% Weighted Average Cost of Secured Debt 4.3% 4.5% Proportion of Fixed/Hedged Interest Rate Debt 95% 95% Debt/Assets 77% 72% Cost of debt 10.00% 9.00% 8.00% 7.00% 6.00% 5.00% 4.00% 3.00% 2.00%
Slide 15: Key Ratios
Key Ratios Comparative Ratios HY2018 FY2017 Book Value per Share (A) $3.32 $3.21 Administrative Expense/Total Revenue 9.3% 8.4% Credit Ratios Net Leverage (B) 3.6 3.0 Operating Cashflow/Debt 7.5% 9.8% EBITDA/Interest Expense 2.2 2.5 A. BV/Share = Net Equity/Shares on Issue B. Average Net Leverage =
Slide 16: Avation Summary
Avation Summary Record Fleet Growth Attractive Industry Dynamics Leading Fleet Metrics Increased Airline and Aircraft Diversification Targeting Lower Cost of Debt Opportunity for Further Growth 16
Slide 17: Question & Answer Section
Question & Answer Section Avation PLC 65 Kampong Bahru Road Singapore 169370 Phone: + 65 6252 2077 www.avation.net Jeff Chatfield Richard Wolanski Robert Heese Iain Cawte Duncan Scott Executive Chairman Finance Director Chief Financial Officer Treasury & Risk Group General Counsel [email protected] r