Gama Aviation PLC COVID-19 Update (5166H)

TIDMGMAA

RNS Number : 5166H

Gama Aviation PLC

25 March 2020

Date: 25(th) March 2020

This announcement contains inside information for the purposes of article 7 of the Market Abuse Regulation (EU) No 596/2014

Gama Aviation Plc (AIM: GMAA)

("Gama Aviation", "the Company" or "the Group")

COVID-19 Update

Gama Aviation, the global business aviation service provider, is today updating investors on the Group's approach to the COVID-19 pandemic, the pro-active actions being taken, current trading and outlook.

The Group's over-riding priority through this period of disruption is the continued safety of its global workforce and clients. We continue to operate under the enhanced preventative and protective measures advised by the World Health Organisation and national health care agencies.

In parallel with our efforts to protect our people and clients, the Group is strongly focused on maintaining business continuity. We have fully implemented our working from home policies and reduced on site presence to the minimum necessary, in line with government guidance. All our divisions remain operational and are delivering services in support of our clients' missions, particularly for those delivering critical services such as NHS Scotland, the Ministry of Defence and other government agencies. In addition, the Group has other longstanding contracts which contribute recurring revenues.

Additionally, and in view of the uncertain global trading environment, the Group is taking pro-active and decisive measures to preserve cash. These measures include but are not limited to; placing annual pay increases on hold, halting recruitment except for critical hires to meet contract commitments, reducing or postponing non-essential expenditure, increasing the emphasis on credit control and pursuing government-sponsored assistance measures. These interventions are being reviewed daily and will be augmented as required.

Current Trading

As the Company's divisions remain operational, the impact on the Group's revenues has been limited thus far. But with an expected escalation in COVID-19 cases within the Group, an increasing focus on containment by national governments and the increased threat of airport closures, demand for services is now reducing at a significant rate.

However, the Group benefits from operating to a resilient and robust business model whereby recurring revenues from long standing government and other contracts will provide the Group with some mitigation against the profound impact of the downturn in activity levels by maintaining critical revenue flows.

Liquidity

The Group retains a USD$50m credit facility with HSBC of which USD$20m is currently drawn down. The Group currently has USD$9m of cash on the balance sheet and anticipates further net cash inflow during the remainder of March, particularly from contracted payments under government related contracts.

Outlook

Despite the proactive measures the Company is taking and the underlying resilience of our business model, the COVID-19 crisis is likely to severely impact the Group's trading performance. However, due to the fast evolving and unpredictable nature of this pandemic, the Board does not believe it is possible to forecast the potential impact with any degree of certainty and that, to do so, could potentially be misleading. Accordingly, it is no longer providing financial guidance for the year ending 31(st) December 2020.

Marwan Khalek, Gama Aviation's CEO, said: "Over the past four decades we have evolved our business model, increased the depth, breadth and scale of our operations and enhanced the skills and expertise of our people in an effort to make our business more resilient to the challenge of periodic economic downturns. The challenge to our business of the COVID-19 crisis is significant and we will continue to manage and operate the business diligently and in the best interest of all our stakeholders in these very difficult circumstances. Our resilient and robust business model, the resolve of our people and the loyalty and support of our clients and shareholders will all be severely tested as we navigate our way through this unprecedented challenge. I am confident that, together, we can prevail and emerge stronger."

ENDS

For further information please visit www.gamaaviation.com or contact:

   Gama Aviation Plc                                             [phone] 

Marwan Khalek, Chief Executive Officer

Daniel Ruback, Chief Financial Officer

   Jefferies International                                        [phone] 

Simon Hardy

Will Souter

   Camarco                                                           [phone] 

Ginny Pulbrook

Geoffrey Pelham-Lane

Gama Aviation - Notes to Editors

Founded in 1983 on the simple principle of delivering its clients' missions with passion & dedication, Gama Aviation Plc (LSE AIM: GMAA) is a highly valued global partner to those who use aviation as a platform to perform.

The Group has three divisions: Air, Ground & Global Services. Air services include: aircraft management, special mission support and charter; with Ground services covering: base & line aircraft maintenance services, aircraft modification design and installation and Fixed Base Operations (FBO). Global Services provides CAM, change management consultancy and industry leading software.

   More details can be found at:   https://www.gamaaviation.com/ 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact [e-mail] or visit www.rns.com.

END

UPDKKPBKOBKKDNB

(END) Dow Jones Newswires

March 25, 2020 03:03 ET (07:03 GMT)