Amedeo Air Four Plus Share Discussion Threads

[my retirement fund] 05/1/2023 11:56

Spitting sorry no firm info unless there's a broker note i have not seen - anyone ?

I'm guessing the issue with Russia having virtually stollen dozens and dozens of wester planes is an industry problem adding to any shortage ? Apparently Russia are breaking many of them for spare parts, so they will never be returned now even in the event of a cease fire.

[fram7] 05/1/2023 10:04

Well the news is that there are not enough planes around to satisfy demand so looks like the A380 might become in fashion again.....and aviation experts will say that only the airlines with A380s will do well because is the most fuel efficient plane per passenger (when full) and it is very comfortable so passengers loves it! Both statements are factually true!
Lets hope to see Amedeo back to 70 or more!

[spittingbarrel] 05/1/2023 09:59

MRF - Any idea what the divi forecast for the year is? TIA

[my retirement fund] 05/1/2023 09:13

Dividends are starting to look healthy again now, 1.5p first up !

onwards and upwards, AA4 really starting to take off now!

[rambutan2] 18/12/2022 22:49

Interims from wed. Nav up due to fx, derivs and the like:

[nicholasblake] 22/11/2022 07:13

MRF, curious as to what exactly you’re querying?

[rambutan2] 21/11/2022 20:31

Yes, the usual mix of pint half full/half empty news. Includes some interesting commentary on the A350-900 valuation.

[gary1966] 21/11/2022 17:51

Nice announcement today. Company believes the market is greatly undervaluing the company and they are always looking at ways to address this.

[gary1966] 28/10/2022 15:27

1.3m gone through at 35p just before 15:00.

[gary1966] 25/10/2022 09:37

Peanuts in monetary terms but nice that a very longstanding, successful activist hedge fund clearly sees value in the sector.

[gary1966] 25/10/2022 07:55

Yes and given that there was no notifiable interest previously that is a large chunk all in one go. I wonder who the seller was.

[rambutan2] 24/10/2022 20:33

Noted that Elliott has picked up 6% - also been a recent buyer of DNA2 and 3:

[gary1966] 14/10/2022 08:37

Looking good for lease extensions on the A380’s.

[rambutan2] 13/10/2022 22:43

Update from sibling (DNA3):

[rambutan2] 12/10/2022 21:27

CousinIT, thanks for the comments. Yes, all the debt is in $, but some of the lease payments do appear to be in £.

Yes, those caps will have flown up in value! They appear to have capped the last of the Thai debt in July.

Agree, unclear on inflation link. But think I heard something about the value of the metals used in the engines increasing?

This goes ex div tmrro.

[cousinit] 10/10/2022 13:34

I think the Emirates/A380, Boeing leases are split - USD to repay the debt and GBP for the excess to pay the dividends. I presume the replacement Thai/A350 leases are in USD.

The Emirates debt seems to have been packaged back-to-back with the leases, so looks effectively fixed. The Thai debt now has interest rate caps (on at least 3 of the 4 aircraft). If the Fed carries on, the interest rate caps may be worth more than the aircraft (assume the lenders won't be completely sanguine about the caps being sold!)

Would imagine that there is an inflation-type relationship on the aircraft that are in demand (so maybe not the A380s) primarily driven by replacement costs (which will probably have an element of current manufacturing and finance costs).

[rambutan2] 09/10/2022 22:05

The drop in Sterling v US$ must be helping with the div payments. Likewise the nav, with the aircraft being valued in $. (The USD/GBP exchange rate was 1.3138 at 31 March 2022 - on 30 Sept it was 1.115).

Re rise in interest rates, most of the debt seems to be fixed or hedged.
I'm unclear as to how/whether it effects the discount rates used, but assume it must to some extent.
Of course, any cash held will now be starting to earn some interest.

I suppose also the value of the aircraft must at least to some extent be linked to inflation?

Or have I got that all wrong?

[langland] 06/10/2022 18:23

'only'18% yield!

[gary1966] 06/10/2022 17:12

Increase in dividend to 6ppa.😊

[petewy] 05/8/2022 19:14

Thanks for the post DaveB

[fram7] 29/7/2022 14:11

good update. lets hope A380s keep their value....they should and the pessimism on A380s is overdone. More fuel efficient plane in the world per passenger (if full). with post covid pent up demand should not be difficult to fill up.
lets hope Thai keeps up with their repayment promises, I do not trust airlines but they are backed by the government so should be fine.
lets hope the company keeps their cost and management remuneration low.

[my retirement fund] 29/7/2022 13:13

Looking like a good investment and income stock

[davebowler] 29/7/2022 10:26

Liberum;
Amedeo Air Four Plus

Improving outlook

Mkt Cap £113m | Share price 32.5p | Prem/(disc) -64.0% | Div yield 15.4%

Event

AA4's full year results have demonstrated a significant improvement in its position. The agreement of the lease amendment with Thai Airways was pivotal in enabling a £30m capital return and the resumption of quarterly distributions. Lease income from Emirates underpins the current 5p distribution. The board has stated that it expects to be able to maintain the distribution at this level for the foreseeable future.


Estimated residual values reduced by 16% in the year. The portfolio comprised 12 aircraft at 31 March 2022 - six A380s (leased to Emirates), two B777s (leased to Emirates) and four A350s (leased to Thai Airways). The majority of the impairment related to the A380 and B777 aircraft.


The situation with Thai Airways has improved steadily since the restructuring completed in December 2021. The airline is making power by the hour (PBH) payments in 2022 before switching to a fixed payment from January 2023. During Q1 2022, flight hours for the four A350 aircraft were equivalent to 60% of pre-pandemic hours. The PBH payments have been sufficient to cover the quarterly interest and expense.

AA4 has also provided additional disclosure on the lease terms. The fixed lease rent from 1 January 2023 is 45% below the previously agreed rent. Thai Airways' rehabilitation plan provides for $6.7m of pre-petition unpaid rent to be payable to AA4 in instalments starting in 2024. This will be used to repay debt. The lease has also been extended by six years, with future rents to be determined by market rates. Thai Airways has announced plans to exit bankruptcy in 2024 and is seeking to strengthen its balance sheet with new equity and debt-for-equity swaps. AA4 has reiterated its view that it does not expect to receive any income from the Thai aircraft after expenses and debt service costs, but there is scope for the recovery of equity value.

Liberum view

AA4's 15% dividend yield is covered by income from Emirates. We believe there is potential for an increase in distributions over time as we estimate recurring earnings of £26m (vs. £17m of annualised distributions). We believe AA4 is gradually building up cash reserves within the A380 SPVs, to ensure there is enough capital to meet obligations on the junior debt. In this regard, the recent sale by Doric Nimrod Air One of its A380 to Emirates for $30m was encouraging. In relation to AA4's A380 aircraft, the lease return compensation and redelivery costs are much lower than $30m. The first of AA4's A380 lease expires in 2026 and it is still unclear what will happen with the aircraft at the end of the lease. Emirates is experiencing capacity issues, in part due to problems with the delivery of Boeing's 777X programme. The first delivery of 777X aircraft is expected to occur in 2025. The success or otherwise of the 777X programme will play a determining role in the residual value of AA4’s A380s. Even on relatively conservative assumptions (no equity value for A380 and $12.5m for A350), we estimate an IRR of 14% from the current share price.

[gary1966] 19/7/2022 09:56

Two trades today for 500 and 750k, both at 34p. Sizeable for AA4 and so I am wondering what is going on.