Air Partner plc Results for the year ended 31 January 2017 Mark - PowerPoint PPT Presentation

Air Partner plc Results for the year ended 31 January 2017 Mark Briffa, CEO Neil Morris, CFO 1

Introducing Air Partner • Air Partner is a global aviation services group headquartered in London Gatwick Air Partner plc • The Group’s global platform operates 24/7 x 365 from 20 key gateway cities • The Group operates two complementary divisions Consulting & Broking Training • Broking : Commercial Jets, Private Jets, JetCard and Freight • Consulting & Training : professional services and managed services in Aviation Safety • Through Air Partner’s Customer First programme, the Group delivers outstanding and exceptional service to some 14,000 clients across the globe • Governments, NGOs, Corporations, HNWI • Sports, Oil & Gas, Automotive, Tour Operators, Military & Civil • A clear long term strategy, with an objective to deliver an even better customer experience, and achieve a balanced business mix which generates a higher quality of earnings for shareholders 2 2

Overview • Strong full-year results • Commercial Jets strong • Exceptional year in JetCard with record utilisation • Remarketing and ACMI both performed well • Baines Simmons contributed 10% of the Group’s underlying profit before tax • Isle of Man Aircraft Registry contract awarded for next 10 years • Strategy to diversify quality of earnings is starting to pay dividends • Acquisition of Clockwork Research 3 3

Financial highlights January January 2017 2016 Change Gross Transaction Value (£m) 215.8 210.8 2.4% Gross profit (£m) 31.7 27.3 16.3% Gross margin (%) 14.7 12.9 +180bps Underlying operating profit (£m) 5.1 4.4 16.6% Underlying operating margin (%) 2.4 2.1 +30bps Underlying PBT (£m) 5.1 4.4 17.2% Underlying EPS (p) 6.5 5.9 10.2% Total dividend (p) 5.2 4.9 7.2% Total cash (£m) 19.8 19.8 - Net cash excluding JetCard (£m) 3.9 3.0 30.3% Underlying relates to continuing operations and excludes non-trading items and non-cash acquisition related costs 4 4

Operating highlights Broking One Group/Two Divisions Commercial Jets: • Gross Profit Strong performances in USA, Europe and ACMI • UK performed well despite non-repeat of major contract • Cabot Aviation successfully remarketed three Boeing 777’s for Kenya Airways and rebranded as Air Partner 18% Remarketing Private Jets: • Exceptional JetCard performance: utilisation up 41% 82% • Strong H1 performance in UK, strong H2 in USA • Improvement in Europe, particularly in Germany Broking Consulting & Training Underlying Operating Profit Consulting & Training • Baines Simmons delivers good performance in first full 11% year of ownership • Renewal of Isle of Man Aircraft Registry contract for further 10 years • Successfully won a number of long-term government and corporate contracts 89% 5 5

Operating profit bridge £’000k • 16.6% increase in underlying operating profit • Stand out performance from Commercial Jets • Consulting & Training now represents 10% of Group profit before tax • Private Jet performance up, but investments made in growing US business • Disappointing year for Freight 6 6

Cash flow bridge £’000k • Overall £914k increase in non-JCD cash • Outflows: • Inflows: • Dividends of £2,574k • Increase in NOPAT of £2,847k • Repayment of bank loan • Addback of depreciation of £780k and tax and • Capex of £269k and acquisitions of £362k interest of £1,012k • Net working capital of £742k • Favourable forex benefit of £736k 7 7

Balance sheet January January £’000 2017 2016 Change Property, plant and equipment 1,086 1,281 (195) Goodwill and other intangibles 8,743 8,384 359 Net deferred tax (192) (408) 216 Net current liabilities (excluding (11,541) (11,723) 182 cash and borrowings) JetCard Cash 15,886 16,776 (910) Non-JetCard Cash net of 972 (456) 1,428 borrowings Net assets 14,934 13,854 1,080 8 8

Gross profit by Product £’m • • Strong performances across our broking division Commercial Jets remains largest division, but has with the exception of Freight decreased as proportion of total GP to 46% • • Strong first full year contribution from Consulting Consulting & Training now 18% of total GP & Training division Commercial Jets Private Jets Freight Consulting & Training 9 9

Operating profit by Product £’m • • Commercial Jets +30% due to strong Commercial Jets remains our largest division US and Europe • Consulting & Training showing change in mix • Private Jets shows lower increase due to investment in US Commercial Jets • Consulting & Training performance Private Jets strong in first full year of ownership Freight Consulting & Training 10 10

Gross profit by Region £’m • • Strong performance in the UK with gross profit up Split by geography consistent year-on-year by 14% • Europe increased 21% • US up 18% year on year UK Europe US 11 11

JetCard goes from strength to strength • Utilisation up by an impressive 41% leading to record performance • JetCard cash balances reduced to £15.9m due to increased utilisation 12 12

Broking 12

Broking Private Jets Freight Commercial Jets 14.8 5.0 10.4 2.5 2.0 1.0 14.6 10.2 4.0 2.0 0.8 10.0 1.5 14.4 Gross 3.0 9.8 1.5 Gross 0.6 Gross profit profit 14.2 9.6 profit 1.0 2.0 1.0 Operating 0.4 9.4 14.0 Operating Operating profit 9.2 1.0 0.5 profit 13.8 0.5 profit 0.2 9.0 13.6 0.0 8.8 0.0 0.0 0.0 FY16 FY17 FY16 FY17 FY16 FY17 • • • Challenging year overall: no Strong performance in Europe due to JetCard success - utilisation up by 41% government aid agency work in Tour Ops, Automotive, Sports and leading to record result • period Government contracts Lower growth in operating profit due to • • Strong performance in automotive USA performed well due to investment in USA • in Europe presidential campaign work Solid performance in Europe • • Strong growth in Sports in the UK Strong start in UK tailed off in H2, offsetting the non repeat contract in whereas USA performance improved the Oil & Gas sector over year • Remarketing has successfully remarketed three Boeing 777’s for Kenya Airways 14 14

Consulting & Training

Consulting & Training Consulting AVIATION SAFETY Managed Training Services • Baines Simmons profit before tax of £0.5m equivalent to 10% of Group total Complementary services • Successful contract wins include BAE Systems, Thomas Cook, Marshalls and with a focus on aviation safety the UK Military Aviation Authority • Renewal of the Isle of Man Aircraft Registry contract for the next 10 years • In house training had a record Q4 • Acquired Clockwork Research, a specialist fatigue risk management consultancy in December 2016 16 16

Acquisition of Clockwork Research • Fatigue risk management consultancy • Team of physiologists, psychologists and safety professionals • Safety critical industries: predominantly aviation, also Oil & Gas and Mining • Training, Risk Assessment, Research, Consultancy • Translates scientific research into operational solutions • Assisting operators to build fatigue risk management systems for over 10 years 17 17

Group Strategy We have a clear long term strategy to build a global aviation services group: • Broaden our customer offering to encompass a full range of aviation services • Extend our geographical reach • Customer First delivering an exceptional customer experience • Leverage the Air Partner brand and heritage A clear strategic roadmap to transform our Group leading to • Growth • Cash generation • A balanced business mix which will reduce volatility, increase visibility and lead to higher quality earnings 18 18

Group Strategic Initiatives • Customer First • Continues to embed across the group • Increased levels of service delivery leading to increased repeat business and customer loyalty • Cross Selling • Ability to maximise the new combined group client base • Success already seen in Sports and Government business • Technology • New Finance system rolled out in February 2017 • Infrastructure upgrades, improved functionality and systems integration • Upgrades to CRM planned for H2 • Partnerships • Strategic partnership with Camper & Nicholsons enabling both companies to offer a full suite of private jets and superyacht services 19 19

Outlook

Outlook • Strong full year results • Results reflect last two years of hard work and commitment from across the group • Trading has commenced in line with the Board’s expectation • Begin financial year with degree of optimism • Transformation continues - Board remains confident that long term strategy to build a global aviation services group will continue to create shareholder value 21 21