Air Partner plc Interim Results for the half-year ended 31 July 2016 - Mark Briffa, CEO Neil Morris, CFO
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Air Partner plc
Interim Results for the half-year ended 31 July 2016
Mark Briffa, CEO
Neil Morris, CFO
1
Introducing Air Partner
Founded in 1961, Air Partner is a global aviation services group that provides worldwide solutions to
industry, commerce, governments and private individuals. Air Partner is headquartered alongside Gatwick
airport in the UK. The Group’s global platform operates 24/7, from in 20 key gateway cities. Enabled by Air
Partner’s Customer First Programme, the Group delivers outstanding and exceptional service to some
14,000 clients across the globe. Clients include six of the G7, and some of the world’s leading employers,
corporations, business leaders, stars and HNW individuals.
2
Divisional overview
• Charters airliners from 20 to 500 people • Flies fewer than 20 people
• Used for product launches, sports teams • Offers a bespoke service or a JetCard
COMMERCIAL and conferences • Typical clients include: finance houses, film
• Typical clients include: automotive, sports, PRIVATE JETS / entertainment and high net worth
JETS individuals
entertainment, pharmaceutical
• Cabot Aviation, remarkets commercial • Ad hoc charter, our bespoke on
aircraft and private jets demand service
• ACMI (‘wet leasing’) • JetCard, a private jet card programme with
>200 cardholders
• Charters aircraft from Learjets to the giant • A world-leading Aviation Safety consultant
Antonov 225 BAINES • Specialises in aviation regulation,
FREIGHT • Time critical door to door delivery service SIMMONS compliance and safety management
• Typical clients include: goverments, • Manages Isle of Man Aircraft Registry,
automotive, engineering and energy awarded 10 year contract in April 2016
SUPPORT
DIVISIONS
24/7 Operations, Travel Management,
Emergency Planning
3
Overview
• Strong H1 results, despite terrorism, tour operating, geopolitical uncertainty
• Broking and Consulting divisions both performed well
• Strategy producing results
• Acquisitions fully integrated and contributing
• Customer First rolled-out globally and supporting growth (Broking op.profit up 24%)
• NED appointments further aligns industry and operational experience with strategy
• Interim dividend increased by 10% to 8.1p
• Full year outlook: Board remains optimistic
4
Financial highlights
July 2016 July 2015 Change
Gross Transaction Value (£m) 112.9 110.2 2%
Gross Profit (£m) 16.1 12.1 34%
Gross margin (%) 14.3 10.9 +340bps
Underlying operating profit (£m) 3.1 2.2 36%
Underlying operating margin (%) 2.7 2.0 +70bps
Underlying PBT (£m) 3.0 2.2 35%
Underlying EPS (p) 22.3 17.1 30%
Interim Dividend (p) 8.1 7.3 10%
Total cash (£m) 24.6 15.0 +£9.6m
Net cash excluding JetCard (£m) 5.2 1.4 +£3.8m
Underlying relates to continuing operations and excludes non-trading items and non-cash acquisition related costs
5
Operating Highlights
Broking
Commercial Jets:
• Significant sport contracts won for Euros and pre-season Premier League tours
• Cabot Aviation successfully remarkets two Boeing 777s for Kenya Airways
Private Jets:
• Record H1 results
• Exceptional UK performance
• JetCard utilisation up by 25%
Freight:
• Good automotive wins
Consulting & Training
• Good performance and solid contribution
• Renewal of Isle of Man Aircraft Registry contract for further 10 years
• Successfully won a number of long-term government and corporate contracts
6
Operating profit bridge
275
525
(89) (209)
311
3,054
2,241
HY15 Commercial Jets Private Jets Freight Baines Simmons Corporate Costs HY16
7
Cash flow bridge
524
3,826
(22) 727
(1,741)
419
1,915
(257)
8,406
3,015
Jan-16 NOPAT D&A Net bank Working cap Capex Tax, interest Dividends FX Jul-16
loans (Excl. JCD) & other
8
Gross profit by Product
100% 0%
8%
90% 19%
80% 5%
36%
70%
60% 32%
£’m
50%
40%
30% 56%
20% 45%
10%
0%
HY15 HY16
• Strong performances across CJ and PJ • Decrease in proportion of gross profit from CJ by
11%
• First time contribution from Baines Simmons
• Baines Simmons 19% of gross profit
• Decrease of 20% in Freight
Commercial Jets
Private Jets
Freight
Baines Simmons
9
Gross profit by Region
100%
14% 9%
90%
80% 27%
70% 31%
60%
£’m
50%
40%
30% 64%
55%
20%
10%
0%
HY15 HY16
• Strong performance in the UK with gross profit up • UK accounted for 64% of gross profit
by 58% or by 12% excluding Baines Simmons
• Europe and US mix reduced
• Europe increased 16% to £4.3m
• US down by 12% year on year UK
Europe
US
10Operating profit by Product
100% 7%
90% 0% 13% 8%
80%
70% 31% 36%
60%
£’m
50%
40%
30% 56% 50%
20%
10%
0%
HY15 HY16
• CJ +18% due to strong UK and Europe • CJ remains our largest division
• Outstanding PJ performance, particularly • PJ increased to 36% of operating profit
the UK
• Decrease in Freight of 22% Commercial Jets
Private Jets
• Encouraging performance at
Baines Simmons
Freight
Baines Simmons
11JetCard goes from strength to strength
250
JetCard numbers
200
150
Europe
US
100
UK
50
0
• Utilisation up by an impressive 25% leading to FY14 FY15 FY16 H117
record H1 performance
• JetCard cash balances year-on-year have risen
by £2.5m (18%) to £16.1m
• The number of JetCards has risen since 31
January 2016 by 9 to 218 – UK 137 (up 9), USA
has 50 (down 2) and Europe 31 (up 2)
12COVER
Commercial Jets
12OIL & GAS AUTOMOTIVE SPORT REMARKETING
Commercial Jets
7.4 2.1
7.3
2.0
7.2
7.1 1.9
7.0
1.8 Gross profit
6.9 Operating profit
6.8 1.7
6.7
1.6
6.6
6.5 1.5
HY15 HY16
• Gross profit increased by 8% to £7.3m
• Underlying operating profit increased by 18% to £2.0m
• Strong performance in the UK as a result of Sports, Oil & Gas and government work
• Automotive and tour operations performing well in Europe
• Cabot Aviation has successfully remarketed two Boeing 777s for Kenya Airways
• H2 in the US expected to improve
15Private Jets
ON-DEMAND CHARTER JETCARD CORPORATE CARD
Private Jets
5.2 1.8
5.0 1.5
4.8 1.3
4.6 1.0
Gross profit
4.4 0.8 Operating profit
4.2 0.5
4.0 0.3
3.8 0.0
HY15 HY16
• Record H1 performance with gross profit increase by 17% to £5.1m
• Operating profit increased by 56% to £1.5m
• Strong performance in the UK through success of Customer First
• JetCard success - utilisation up by 25% leading to record H1 result
• Solid performance in Europe
• US showing signs of improvement
18Freight
OIL & GAS
AIRCRAFT PARTS
HUMANITARIAN AID AUTOMOTIVE PARTS TIME CRITICAL
DANGEROUS GOODS
HIGH VALUE CARGOFreight
1.0 0.50
0.9
0.8 0.40
0.7
0.6 0.30
0.5 Gross profit
0.4 0.20 Operating profit
0.3
0.2 0.10
0.1
0.0 0.00
HY15 HY16
• Gross profit decreased by 20% to £0.8m
• Operating profit decreased by £0.1m to £0.3m
• Strong performance in automotive in Europe
• Tough comparable: no government aid agency work in period
21Baines Simmons
CONSULTING TRAINING MANAGED SERVICES
Baines Simmons
3.5
3.0
2.5
2.0 Gross profit
1.5 Operating profit
1.0
0.5
0.0
HY16
• Gross profit of £3.0m, representing 19% of the group
• Operating profit of £0.3m, equivalent to 10% of the group
• Successful contract wins include Isle of Man Aircraft Registry for 10 years, BAE
Systems (Typhoon) and a number of commercial airlines
• Encouraging performance from Baines Simmons which was acquired in August 2015
24Summary
Strategic update
• Focused on building a world class aviation services group
• Delivering tailored and comprehensive aviation solutions to our global customers
• Strategy based around three components: Optimise, Enhance and Extend
• Good progress made acquiring or investing in complementary
capabilities/services that support these three components
Optimise Enhance Extend
Initiative Customer First Acquisition of Acquisition of
Cabot Aviation Baines Simmons
H1 result Broking op. profit up 2x Kenya Airways Isle of Man Aircraft
24% Boeing 777s Registry renewal
remarketed
26Outlook
• Strong first half performance
• Current trading good albeit slowest trading quarter to come
• Continue to assess investment opportunities that will enhance or extend our
customer services
• The Board remains confident that its expectations for the remainder of the
financial year will be achieved
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