Alliance Aviation Services, which provides contract, charter and allied aviation and maintenance services in Australia, has reported underlying net profit before tax of $20.7 million for the half year period, down $6 million compared to the year-ago period, on revenues from operations of $171.2 million, up $16.4 million over last year. The increase in total revenue in the half year was a result of growth in contract and wet lease activity. Wet lease activity grew significantly compared to prior comparative period (“PCP”) which resulted in revenue generation of $14.9 million however this was lower than forecast due to ongoing COVID-19 issues. Charter and RPT revenues decreased in the period by 64.3% and 33.3% respectively when compared to the PCP
The Group recorded a positive underlying operating cashflow of $50.5 million. The company reports a statutory loss before tax of $4.5 million for the half year.
Alliance retains a positive outlook for the 2022 financial year with exponential growth from the 2023 financial year as the additional aircraft are deployed.
Alliance states that it has continued to invest heavily in preparing for its next phase of growth. This investment included operating costs for recruitment, personnel, training, financing, and regulatory infrastructure of $25.2 million related to the E190 program. This was expensed in 1HFY22 and has contributed to the Group reporting a statutory loss before tax of $4.5 million.
Alliance’s Managing Director, Scott McMillan, stated, “Alliance will continue to invest in fleet, equipment, spare parts and personnel to ensure the Company has the required capacity to satisfy its contracted wet lease routes and other future growth post COVID-19.”
“Since the last reporting period the Company has increased its operating fleet by eight E190s and number of personnel by 87. It is well known that there have been numerous impacts on the national economy brought about by COVID-19 and various government responses. As a result, the Company has suffered a delay on wet lease flying activity. Alliance maintains a very confident outlook and is of the view that significant additional flying will commence in April this year.”
In FY21, the company flew 37,913 hours. With the continued investment in fleet and personnel, Alliance will have an annualised capacity of 135,000 hours. The company states that it already owns the fleet required to deliver this capacity, which will result in substantially increased financial performance.
The Group has also commenced construction of the Rockhampton Maintenance hangar, which is a 10,000 sqm structure scheduled for certification in January 2023. This facility will allow all base maintenance to be brought back from overseas with a significant future benefit to Group profitability, fleet availability and reduced fuel consumption. Complementing the drive for self-sufficiency, the company’s subsidiary, Unity Aviation Maintenance Pty, will no longer provide third party maintenance services and will become the E190 centre of excellence for Alliance’s line maintenance operations.
The Company’s traditional FIFO business remains robust with opportunities for material growth in the short and medium term.
Since COVID-19 took hold at the start of calendar 2020 the company has invested in growth by acquiring 32 E190 aircraft; expanded operations to support the fleet through hiring and training 78 pilots, 77 cabin crew, 36 engineers (partially acquired through Unity Aviation Maintenance) and 25
additional corporate staff; commenced construction of a purpose-built maintenance facility in Rockhampton, partly funded by a long term NAIF facility. This provides sovereign security around our
future heavy maintenance capability; and taken the opportunity to win new contracts by targeting customers that typically (pre- COVID-19) utilised regular public scheduled flights and see value in a dedicated service.