Gama Aviation PLC Trading Statement (0007E)
13 July 2016 - 7:00AM
UK Regulatory
TIDMGMAA
RNS Number : 0007E
Gama Aviation PLC
13 July 2016
July 13 2016
Gama Aviation Plc (AIM: GMAA)
("Gama" or the "Company")
Trading Update
Gama Aviation Plc, one of the world's largest business aviation
service providers, is pleased to announce that consolidated
revenues, reported on a constant currency basis(1) , for the half
year ended 30 June 2016 will be no less than $205m (2015: $191m)
and adjusted EBITDA(2) will be no less than $7.5m (2015:
$8.2m).
Current Trading
These revenues have been achieved despite the continuation of
the challenging trading environment in Europe, as previously
highlighted at the time of the final full year results to 31
December 2015, announced on 21 April 2016. The Board does not
believe that this is likely to change in the short term. It is
however pleasing to report that the initiatives launched earlier in
the year to optimise and right size the European business and its
cost base in this challenging market are beginning to generate some
improvement in the underlying financial performance in the
region.
Trading in our US business remains strong and we continue to
enjoy solid organic revenue and margin growth. The US Air business
has added another 9 planes to the fleet under management. The US
Ground business has continued to expand its line maintenance
facilities and has added another base in Bedford, Massachusetts.
Gama's US Ground operation now has nine bases in total providing
full East to West and North to South coverage across the USA.
Both of our Middle East and Asia operations continue to make
steady progress. Preparation for the start of our Sharjah hangar
development is well underway and we expect to break ground before
year end. In Hong Kong we now have the capability to provide line
maintenance support for our managed fleet and we expect to be able
to roll this out to third parties in the near future. Both regions
have a healthy pipeline of aircraft management opportunities.
Growth Strategy
The Board continues to implement its growth strategy which is
focused on both organic and acquisitive growth.
With regard to organic growth, the benefits of scale, the
breadth and depth of Gama's geographical offering means that the
Board is able to divert resources to wherever the best organic
growth opportunities lie. Presently these primarily lie outside of
Europe and the Board is therefore focusing more on those
opportunities whilst continuing to optimise business performance
within Europe.
With regard to acquisitive growth, the Board has a very strong
pipeline of both small acquisition targets as well as some larger
and more material transformational targets and continues to
actively pursue both against the objective of only executing on
those that deliver a good strategic fit, are accretive and are
earnings enhancing.
Since the beginning of the financial year, the Company has
completed the bolt-on acquisitions of Aviation Beauport Ltd in
February 2016 and of FlyerTech Ltd and Aerstream Ltd in July 2016
both of which were organically funded. The Board will continue to
pursue these types of small but strategically important targets and
will continue to fund any such acquisitions through a combination
of cash generated from ordinary business operations and debt.
The larger and more transformational opportunities and targets,
of which the Board has a strong pipeline, are more likely to be
funded largely through the issue of equity so as to contain debt at
sensible levels. However, at the Company's current share price the
Board believes the issue of further equity to be too dilutive and
is therefore unlikely to pursue such material and transformational
opportunities until the share price recovers to a level where such
transactions can be more accretive.
Gama will release its interim results for the six months to 30
June 2016 in September.
1 - The results above are for continuing operations and
calculated at a constant foreign exchange rate of $1.5 to GBP1.
2- Adjusted EBITDA is arrived at by taking operating profit
before depreciation, amortisation and exceptional items
End
Gama Aviation Plc
Marwan Khalek, Chief Executive +44 1252 553010
Citigate Dewe Rogerson +44 207 638 9571
Chris Jarvis, Associate Director
Phil Anderson, Executive Director
Jefferies International +44 207 029 8000
(Nominated Advisor & Broker)
Simon Hardy
Harry Nicholas
This information is provided by RNS
The company news service from the London Stock Exchange
END
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July 13, 2016 02:00 ET (06:00 GMT)