Amedeo Air Four Plus Share Discussion Threads

[fram7] 09/10/2023 10:54

but if A380 sell for about 35 million $ Amedeo is fine an all the you tube videos from airline influencer predicting A380 are only good for spare parts are wrong.....like the majority of prediction form influencers....
Of course there is a lot of variability on the final sale price depending on age/conditions/contract but I would take this as very positive news. Amedeo shares should go up more.

[davebowler] 09/10/2023 09:48

Liberum-

Leasing

Doric Nimrod Air Two

Two A380 sales, capital distribution to follow
Analyst: Shonil Chande and Gerald Khoo

Mkt Cap £165m | Share price 95.5p | Prem/(disc) -17.0% | Div yield 18.8%

Event

Doric Nimrod Air Two has agreed the sale of two A380 aircraft to Emirates for $70m in aggregate. The aircraft in question, MSN 77 and MSN 90, are 12 years old. Their leases are due to expire on 14 October 2023 and 2 December 2023. Assuming successful completion, DNA2 will be left with five A380s with leases expiring up to November 2024.

Distribution to total c.£59m

DNA2 plans to distribute two ordinary preference shares for every seven ordinary preference shares, at c.120p. We estimate the value of the distribution to be c.£59m.

Liberum view

This is the third high-quality data point YTD involving the sale of an A380 from a Doric vehicle to Emirates. Like the Doric 1 A380 sold in January 2023 (MSN 16), the two DNA2 planes are not active in the fleet. They have been stored for a few years. The DNA2 leases expire between October 2023 and November 2024. The evidence to-date displays a preference by Emirates to acquire aircraft on expiring leases rather than extend leases.

Emirates served notice to DNA2 of its intention to return MSN 077 in half-life condition plus a cash amount, in March 2022. So far, these notices have not provided a steer on the direction of travel between 1) Emirates returning the aircraft at their half/minimum-life conditions; 2) extending leases; and 3) buying the aircraft of the lessors.

*AA4 read across is incrementally positive

Amedeo Air Four Plus has six A380s in its fleet. Four of the aircraft have been in service and the other two are scheduled to return to service over the next year. The read across to AA4 from the sale by DNA2 is incrementally positive. This is a better value than the c.$30m (£25.3m) achieved by DNA1 from the sale of its sole A380 asset in July 2022. However, unlike the DNA funds, AA4 has junior debt balloon payments associated with its A380s. These payments are $35m on four aircraft and $40m on two planes. Consequently, AA4 would need to achieve higher prices for its A380s than so far achieved by DNA1 and DNA2 in order to secure any residual value for shareholders after the debt balloon payments. We have a BUY recommendation on AA4 with a 50p TP.

*Corporate Broking Client of Liberum

[rimau1] 09/10/2023 08:17

£28m is about right and is consistent with our views on this BB. Good to have an up-to-date valuation. The positive read across for AA4 is that Emirates will almost certainly be extending our aircraft leases now or buy the planes.

[eeza] 09/10/2023 07:37

DNA2 sell 2 x A380 to Emirates for £29.8m each ($70m).

[clive7878] 03/10/2023 12:31

Quick test - buy 46.3, sell 46.06
Probably buying before they go ex-dividend next week.

[langland] 03/10/2023 10:55

The 46.34 trades are buys.

[clive7878] 03/10/2023 10:04

Still today sells a week before ex-dividend

[eeza] 03/10/2023 07:48

1.75p confirmed. XD 12 Oct.

[clive7878] 02/10/2023 19:34

Week Thursday - ex-dividend
Should know this Thursday if it is the same 1.75p as the last quarter.

[mattjos] 02/10/2023 19:31

latest Emirates TV advert showing A380 lounge suggests they are pretty committed to A380

[clive7878] 28/9/2023 17:00

Has the Emirates got another 3 years to run though?
They were paying 2p dividend I believe at one stage in the past before covid, but they will now prob keep it at 1.75p going forward.

[scrwal] 28/9/2023 14:37

There is no need to increase the dividend as the yield is already very good. Just stash the cash in the shorter term until we know what happens with the Emirates 380s.

[stoph] 28/9/2023 07:29

Thanks, I am looking to get in as this looks really good

[nicholasblake] 27/9/2023 23:20

They could (and probably should) afford to edge it to 2p.

[clive7878] 27/9/2023 21:32

Next amount of next dividend is probably going to be the same as last month at 1.75, but should be confirmed on 5th October. Be interesting if it affects the share price before it goes ex-dividend on the 12th as share price has been quite stable in the share band of 46.0 to 47.5p.

October will be an interesting month, if as a previous posted said the Doric 2 aircraft lease expires on 14th October and the company together with the company leasing it has to make a decision whether it is re-leased or sold, which could well affect the share price up or down depending on the deal.

[stoph] 27/9/2023 07:56

Does anyone know the amount of the next dividend and when it goes ex-div and when it is paid?

[andyandyoj] 16/9/2023 15:19

Unless the Doric 2 aircraft with lease expiry on 14th Oct is either sold or has a lease extension. That could move the price strongly (not sure which direction - depends on the price). But has to be declared before 14th Oct

[clive7878] 15/9/2023 14:52

Share price may not move outside it's current band until beginning of October when it goes ex- dividend.

[indiagolf12] 13/9/2023 19:40

Increasing demand for A380 routes it would seem:

hxxps://simpleflying.com/emirates-adding-airbus-a380s-australia/

[strollingmolby] 09/9/2023 12:20

Fund commentary from one of the largest shareholders, Staude Capital (via Mirabella Financial Services):

Notable holdings in FY2023

For the second financial year in a row, the largest positive contributor to performance was Amedeo Air Four Plus (AA4) - a special situation that GVF has held since 2020. In GBP terms, GVF’s investment in AA4 returned 77% in FY 2023.

As discussed in previous commentaries, what originally attracted us to AA4 was: a large amount of surplus cash; leases promising many years of significant income from Emirates; and what we felt was a compelling expected total return, even with pessimistic aircraft residual values factored in. AA4’s strong performance in FY 2023 comprised a mix of capital returns, dividends, and share price appreciation, each of which illustrates these attributes.

Capital returns came in the form of a £28M mandatory redemption by the company, through which GVF exited 12.5% of its holding at a price 105% higher than our carrying value at the start of the financial year. GVF has now received three such distributions of surplus cash, but we estimate AA4 still has considerable cash left and expect this to be returned in future years.

Dividend income represented 18 percentage points of the return in FY 2023. Emirates leases fund a mid-teens dividend yield, even after covering the costs of the entire company, and with some of the income held back to cover certain outstanding debt obligations at the end of the leases. During FY 2023, the company increased its quarterly dividend by 16.7%, albeit this was also a function of the reduced share count following the redemption of shares.

Finally, there was share price appreciation. In July 2022 another London-listed aircraft leasing vehicle announced it had agreed to sell its sole A380 aircraft to Emirates for a price of £25.3M. This was considerably higher than the market had been anticipating, and prices of AA4 and similar vehicles reacted accordingly as the market rebased its expectations. Sentiment towards AA4 and similar vehicles has also been helped by the continued rebound in air traffic, reports of a shortage of widebody aircraft, and continued delays in the rollout of Boeing’s 777X (seen as the replacement for Emirates A380s).

[clive7878] 07/9/2023 21:30

One buy trade today for 35,000 went through at 48.75p indicating that the MM are charging more for bigger volumes which could be a good sign.

[cousinit] 07/9/2023 17:58

All of the previous extensions were pre Covid so not sure how much impact that has made versus other factors like age, maintenance costs. Seems the annual rent was around $10m, so now probably $4m region

[andyandyoj] 07/9/2023 16:14

Actually I found a German arti Le that describes the impact. The shareholders paid off the loans in 2022. From 2022 to 2025 the company (Dr Peter’s) has paid out -10% pa. The years from 2026 to 2031 will be 3.75%. So looks like they reduced the (already extended) lease by 62.5% (at least in terms of what the dividend payouts were. I think this was the second reduction (the lease was already 17 years!). So looks like shareholders have done nicely but the lease rates definitely went down for the second lease extension. If similar were to happen here then I think it could be quite nice news for AA4. Much would then depend on what the company would do with the Thai aircraft.

[andyandyoj] 07/9/2023 15:01

hxxps://simpleflying.com/emirates-fly-boeing-777-200lr-into-2030s/

Nice indicator here - They extend 777-200LR (Amedeo owns 300s so not quite the same) into the 2030s - after the loans paid off for the lessors. Would be fascinated to know the terms...