China Aircraft Leasing Group (CALC) has reported total revenue for full year 2016 up by 58.0% to HK$2,448.1 million on the back of continued expansion of the aircraft leasing business and gains from the disposal of finance lease receivables. Net profit grew 67.9% to HK$638.4 million. Basic earnings per share increased by 58.6% to HK$1.009. The return on average shareholders' equity increased by 5.2 percentage points to 24.4%. Total assets increased by 29.0% to HK$30,900.2 million as a result of a larger fleet size. Gearing ratio dropped by 3.1 percentage points to 83.6%.
During the period, CALC completed the disposal of the finance lease receivables of 14 aircraft, which constitutes a recurrent part of the Group’s business, and declared a final dividend of HK$0.39 per share (2015: HK$0.18 per share), bringing the total dividend for the year ended 31 December 2016 to HK$0.53 per share (2015: HK$0.22 per share).
The Group plans to adopt a new dividend policy, which targets to increase its dividend payout ratio from 30% to 50-60%, in order to attract long-term investors
CALC delivered 18 aircraft in 2016 and its fleet size rose to 81 aircraft with an average age of less than four years and an average remaining lease term of nine years.
The Group’s client base increased by five airlines to 16 and CALC expanded its global footprint to cover Europe, Southeast Asia, Japan and the US. The Group maintained a 100% aircraft lease occupancy rate in 2016.
CALC has an order book of 92 aircraft with Airbus and expects to deliver at least 19 aircraft in 2017 and to expand its fleet to not fewer than 173 aircraft by 2022 based on its current order of commitments (not including aircraft transactions under ARI).
CHEN Shuang, Chairman of CALC, said, “The successful disposal of finance lease receivables and business expansion recorded rapid growth in 2016. This strong growth and the Group’s excellent performance have reaffirmed our strengths and reinforced our confidence in future development. With a notable expansion of our client base and the increase of our global footprint, we are well positioned to further develop into a world-class aircraft service provider globally.”
Mike POON, Chief Executive Officer of CALC, added, “In 2016, we took full advantage of the opportunities presented by the market, and enhanced our position as a leading full value-chain aircraft solutions provider by proactively implementing our globalization strategy and fleet expansion plan.
“ARI’s first sale-and-leaseback deal, together with its first aged aircraft purchase transactions, highlights our first-mover advantages as Asia’s first full value-chain aircraft solutions provider, and validates our unique operating model. We intend to maintain a relatively attractive dividend payout ratio for shareholders on a long-term basis. In addition, ARI recently completed the acquisition of a 100% equity interest in Universal Asset Management, Inc. (“UAM”), a provider of commercial aviation asset management, aircraft recycling services and component sales based in Tennessee in the United States. ARI will gain immediate access to the influence of UAM's strong brand, extensive clientele and professional team to forge ahead with its globalization strategy.
“Looking ahead, we see the demand for full value-chain aircraft solutions increasing as airline fleets continue to expand, age and retire. With the aircraft disassembly center to commence operations soon, we are well placed to deliver profitable growth and create excellent shareholder value in the future.”