5th Aug 2014 08:19
LONDON (Alliance News) - BBA Aviation PLC on Tuesday posted flat operating profit on a slight rise in revenue in the first half of 2014, but a big jump in pretax profit, and expressed its confidence for the coming year amid a continuing recovery in the US market.
The FTSE 250-listed aviation services firm said first-half revenue rose 3.6% to USD1.15 billion in the six months to June 30 from USD1.11 billion a year ago.
Operating profit was flat at USD78.1 million, compared to USD78.8 million a year earlier.
Pretax profit however jumped 46% to USD92.0 million against USD63.2 million in 2013. BBA booked a net exceptional gain of USD12.8 million in the recent period, compared with an exceptional loss of USD15.2 million in the year-earlier period. The company said profit on the sale of the APPH business within Aftermarket Services during the recent half was partly offset by merger-and-acquisition-related costs and expenses related to the restructuring of its Engine Repair & Overhaul business.
On the back of the results, BBA pushed up its dividend by 5.0% to 4.62 cents, against 4.40 cents a year earlier.
BBA said it had seen outperformance in its Flight Support business over the period, which offset weakeness in its Aftermarket unit.
Flight Support, which represents 65% of group earnings, saw organic revenue increase 8% and underlying profit increase 14%. The performance of the unit was bolstered by the continued recovery in its US business and general aviation flying activity.
Aftermarket Services, however, saw revenue fall 4% and operating profit drop 11% on weaker engine repair and overhaul markets.
BBA said it had expanded its Flight Support network over the period, including through the USD55 million acquisition of the Scottsdale AirCenter FBO.
"As we enter the second half, we continue to see recovery in our major US business and general aviation market. We also saw a strengthening of the Aftermarket order book at the end of the first half," said BBA Aviation Chief Executive Simon Pryce.
"This, together with second half contributions from acquisitions and our Engine Repair & Overhaul footprint optimisation programme, means that we are confident that BBA Aviation remains well positioned for another year of progress," he added.
BBA shares were down 0.9% to 309.80 pence in early trade Tuesday.
By Sam Unsted; [email protected]; @SamUAtAlliance
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