Share Name Share Symbol Market Type Share ISIN Share Description
Avation Plc LSE:AVAP London Ordinary Share GB00B196F554 ORD 1P
  Price Change % Change Share Price Shares Traded Last Trade
  0.00 0.0% 302.50 10,326 08:02:30
Bid Price Offer Price High Price Low Price Open Price
300.00 305.00 302.50 301.50 301.50
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
Industrial Transportation 93.96 20.13 31.72 9.8 190
Last Trade Time Trade Type Trade Size Trade Price Currency
16:06:56 O 5,000 303.9999 GBX

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Date Time Title Posts
16/1/202009:06Avation - Fly to Let2,367
25/1/201312:03Avation traded on Plus753
01/10/201018:35Flying High?-

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Avation Daily Update: Avation Plc is listed in the Industrial Transportation sector of the London Stock Exchange with ticker AVAP. The last closing price for Avation was 302.50p.
Avation Plc has a 4 week average price of 266p and a 12 week average price of 264p.
The 1 year high share price is 306p while the 1 year low share price is currently 260p.
There are currently 62,709,942 shares in issue and the average daily traded volume is 30,784 shares. The market capitalisation of Avation Plc is £189,697,574.55.
carcosa: "Sounded downbeat to me which is unusual." You may be right but I read it as upbeat; confirmation TC aircraft impact is not worth worrying about, revenues ahead, ATR's on schedule... and the very first interim dividend announced. At a guess am thinking its the "but gains on the sale of aircraft will be lower than the comparable period of 2018" part of the RNS which caused the morning price drop (?). The lack of aircraft sales gains can hardly come as a surprise though so I don;t know what to make of it. Comes back to the argument with Avation that it is NAV that should be driving the share price and profitability is of secondary importance. To me that's a very short term outlook. At this stage of the company's life aircraft sales should be seen as icing on the cake. Who knows, those two TC aircraft may be sold in H2 as they are up for sale anyway. You say "WHI reduced FY 20 PBT by 12.5% due to lower lease revenue and timing of ATR deliveries" You read that today?? Based on their September note, Avation will meet the top end of their revenue forecasts IMO and in all likelihood exceed them. So I am non-the-wiser really. If exchange rates were changing significantly then I could put it down to that but at the moment that is not the case. LIBOR rates have not changed a great deal either. So am just "Shrugs"
carcosa: QP, I think you are taking a pessimistic view (but I'm a shareholder, so only natural for me to say that!) On my post on The Lemon Fool I provide past examples of re-allocating A321's over the last few months from large airline bankruptcies; that gives you reasonable timescales to work with. It's not too difficult to work out potential loss of profitability and it's relatively small. Add back re-leasing the aircraft at a potentially greater net interest margin than with Thomas Cook, plus recoveries using the mechanisms identified in today's RNS, and by June 2020 results I doubt you will notice any material difference to profitability. If things go as well as they did with the Air Berlin aircraft then perversely profitability will increase. I have said before that high levels of profitability for an aircraft leasing company is counter-productive as its a sign of not being able to deploy those profits back into higher earning assets. This is why you will never be able to value aircraft leasing companies against FCF. There really should not be any! Hence as a long term investor it remains the NAV as the driving force for the share price for me.
carcosa: Because the discussion with US-Bangla are ongoing and there would still be an LOI or other contract intent that would prevent AVAP perhaps? Braathens might have configured their aircraft differently. Share sale yesterday was tiny and actually took place many days ago. It was the UT trade at the end of day that pulled the reported share price down and today it basically recovered. I don't see today's ATR deal having an influence on the share price to any great degree when it was already highlighted over the past few weeks. I see oil price and exchange rates as the highest risk to the share price in the short term.
harrogate: While they call it a cash flow hedge on the results it is actually an interest rate hedge. As they say in the results over 90% of the borrowings are fixed or hedged. So they have lots of hedges in place to protect against interest rate rises. The downside of that is that you potentially lose some of the upside when rates fall. Given that they have had to show what the "cost " of that has been by marking the hedges to market. The $18m will be the amount that the hedges will cost them over the life of those hedges if rates stayed the same as at June 19 over the length of each hedge. So none cash and should reverse over time and if interest rates go up then disappear quickly and we get a large increase in NAV just as it has been a hit to that now. having said that the share price looks up with events for now but that could change if they do some decent deals on airbus
carcosa: Looks like someone managed to get £1.34m worth of shares according to this Post Trade Deferral Off-Book report. That's about 0.9% of the company. May also be the reason for the 2.6% increase in the share price of late; but I thought such trades were only protected for 48 hours? It's also reported at todays 'buy' price. Could someone, maybe a trader explain the most likely underlying story?
davidosh: Just to mention that AVAP will have a stand and be presenting at our MelloSouth event in Hever,Kent on 14th June and all shareholders and potential investors are welcome to attend Http:// Richard Wolanski for Avation has presented at our Mello events on a number of occasions before and the company are very popular with Mello investors with the share price having doubled plus dividends for early investors and those who attended Mello2014 where Richard presented. We are very pleased to welcome him back as he unfortunately could not make it to Mello2018 last month in Derby so this is an ideal opportunity to meet the management and hear about their strategy. Do come and join us at this quality event and there will be at least 25 other companies to meet plus some fabulous keynote speakers and a large number of fund managers presenting and on panel sessions. Http://
carcosa: Hi harrogate, I very much doubt that. Mandarin Airlines is a subsidiary of China Airlines and hence a major carrier. Very savvy/drive a hard bargain etc. What has happened is that Avation have had to sweeten the deal.. or 'add value'. If you read between the lines of the RNS, I reckon that ATR have provided the pilot training/aircrew and Avation have paid for it. In the grand scheme of things it is a minor cost over the lease term. The good news is that Mandarin should have got the aircraft at a much lower than average price compared to most of the ATR fleet. Financially the airline will have a very good credit rating (I expect) which may have allowed the financing cost to be a little lower, more than enough to defray the pilot training costs. Although the revenues (based on the acquisition cost) will be a bit lower, what it also means is that it will give Avation the opportunity to review the market value of these aircraft and end up with a NAV above purchase price which will be supportive to the share price.
harrogate: Given that they spend a lot of time raising cash through various loan note offers and struggled to get one of them away recently and seem to pay 7% + on these I still don't see the point in buybacks = why not use the free cash to fund more aircraft and grow the company and let the share price look after itself? They have done a brilliant job and I have not sold a share in these for years as I see great potential.
carcosa: Today, Avation released it's FY prelims. Overall the ATR aircraft are once again selling like hotcakes around the world and production slots are likely at a premium. Avation currently holds a number of production slots values in excess of $3m but quite possibly worth a tad more. Demand for the ATR aircraft has resulted potential and meaningful gains on aircraft sales against their deprecitation book value. As Avation tend not to hold on to old aircraft the industry depreciation rate will continue to hide the hidden value in their ATR portfolio. This past year Avation were approached by several entities wanting to buy their ATR fleet at a substantial premium over book. Whilst as first glance this sounds an excellent outcome, in practice it would have resulted in the company effectivly going back to 'sqaure one'. A compromise of selling a portion of the fleet was made resulting in a gain of $5.3m or I estimate about 5% over book value; lower than I initially thought at the time of the sale. Their headline numbers showed: NB: Items in brackets are (Consensus Forecasts) [My forecasts] Lease Revenue up 32% at $94.2 million ($94m) [$92.8m]; Operating Profit grew 32% to $60.2 million; [$56.1] Profit before taxation increased by 18% to $21.4 million ($19.7m) [$24.3m] Total profit after tax increased 16% to $21.3 million; (19.7m) [$21.9m] Operating cash flows increased 20% to $63.0 million; Dividend per share increased by 85% to 6.00 US cents; and Earnings per share ("EPS") increased by 6% to 36.3 US cents.($0.32) [$0.36] Other areas of improvement include a lower LTV of 72% and an upgrade in the credit rating. Sitting on a hefty cash pile following the ATR sales too Of particular interest was their annoucement that they would now start to consider wide-bodied aircraft to be added to the fleet. Thi sis a new development and something that they have shied away from in the past. It suggests that narrowbodied aircraft valuations are high and, although potentially higher risk perhaps the returns from widebodied aircraft are more attactive now. Certainly lease income form one widebodies aircraft, if less that 8 years old, is a multiple of that obtainable from ATR's and indeed narrow-bodied jet aircraft. Interesting to note that for the first time Avation have not split out asset valuations between jet and turboprop aircraft (or may have to wait for the annual report for that detail). The 'real' measure for share price valuation is the book value/share which stands at $3.21/share Current share price in $ terms is ~246p which is marginally below yesterdays closing price. However a fair view is that the share price should be a multiple of the book value. Going forward however, the loss of lease revenue from the now sold 6 ATR's is going to substantially decrease lease revenue and aircraft asset valuatoin next year. However it is in the nature of their business to aquire further aircraft and if they announce additions to the fleet within the next three months then I am comfortable with the current share price. Questions: Previous years Avation have shied away from wide-bodied aircraft entering the fleet. In today's prelims there is an indication that they are considering this aircraft type now. Why the change of heart? (narrow bodied valuations too high?) Why is the tax charge so low? Is this a timing issue?
carcosa: It took them nearly 9 months to place those last 3 ATR's; which is a bit surprising. I also notde they were non-specific regarding the lease length of those latest aircraft; unlike prior announcements. Also the implication is that they are non-revenue earning between factory delivery to AVAP and delivery to the lessee. Also they have had some older narrow bodied aircraft for sale for a long time now with no progress being made; although the recent extention/new customer of A320/MSN1607 was welcome news although I note they did not make mention of the contingency payment related to that aircraft at the end of its current lease. Looking ahead to FY 2018 the current fleet would result in about a $5m shortfall in revenue compared to this year's expectation with a substantial reduction in profits. As things stand at the moment P/NTAV is around 1.0 which some would consider is about right. However between now and June 2018 a lot has to happen to support the share price and that is most likely to be more jet aircraft to up the NAV. Am a bit disappointed that has yet to happen because the last six months or so have been a bit slow; I was hoping once the ATR sale had completed a raft of announcements would be forthcoming but this has not happened. With LIBOR rates creeping up what they do now can have significant implications for re-leasing of aircraft in years to come. The other item that may assist the share price is an upward revaluation of the current ATR fleet (assuming no change to the Airbus fleet). There is plenty of anecdotal evidence that this is a possibility. Then, if they ever get rid of the older Airbus aircraft above book value that could dramatically positively affect the balance sheet; but I really wouldn't hold out much hope of that happening anytime soon or if it did the premium might actually be negative/small. Right now I feel the share price reflects the value of the company but given the results (and why do they have to be issued so late after closing the books??) are due I'm inclined to wait-and-see what they say about the future before considering selling my shares (first bought 2013) Basically, business as usual.
Avation share price data is direct from the London Stock Exchange
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